Testor Paints sells varnish with a variable cost of $6.50 per gallon. The company is unsure which price to charge in order to maximize profits. The price charged will also affect the demand. $$\begin{array} { c c }
\text { Gallons Demanded } & \text { Unit Price Per Gallon } \
20,000 & \$ 11 \
30,000 & \$ 10 \
40,000 & \$ 9 \
50,000 & \$ 8
\end{array}$$ If fixed costs are $80,000 and the chart above represents the demand at various prices, what price should be charged in order to maximize profits?

Question

Testor Paints sells varnish with a variable cost of $6.50 per gallon. The company is unsure which price to charge in order to maximize profits. The price charged will also affect the demand. $$\begin{array} { c c } 
\text { Gallons Demanded } & \text { Unit Price Per Gallon } \
20,000 & \$ 11 \
30,000 & \$ 10 \
40,000 & \$ 9 \
50,000 & \$ 8
\end{array}$$ If fixed costs are $80,000 and the chart above represents the demand at various prices, what price should be charged in order to maximize profits?

Quizplus · Accepted Answer

The Answer of Testor Paints sells varnish with a variable cost of $6.50 per gallon. The company is unsure which price to charge in order to maximize profits. The price charged will also affect the demand. $$\begin{array} { c c } 
\text { Gallons Demanded } & \text { Unit Price Per Gallon } \
20,000 & \$ 11 \
30,000 & \$ 10 \
40,000 & \$ 9 \
50,000 & \$ 8
\end{array}$$ If fixed costs are $80,000 and the chart above represents the demand at various prices, what price should be charged in order to maximize profits?

Testor Paints Sells Varnish with a Variable Cost of $6