Suppose a typical consumer's inverse demand function for bottled water at a resort area where one firm owns all the rights to a local spring is given by P = 15 - 3Q.The marginal cost for gathering and bottling the water is $3 per gallon.Find the optimal number of bottles to package together for sale and the profit-maximizing price to charge for the package.Show the solution graphically.
Figure 11-2

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The Answer of Suppose a typical consumer's inverse demand function for bottled water at a resort area where one firm owns all the rights to a local spring is given by P = 15 - 3Q.The marginal cost for gathering and bottling the water is $3 per gallon.Find the optimal number of bottles to package together for sale and the profit-maximizing price to charge for the package.Show the solution graphically.
Figure 11-2

Suppose a Typical Consumer's Inverse Demand Function for Bottled Water