The town of Marshall's Boy Scout Troop 1099 decreased car parking prices at the Celebrate Marshall Festival and found they made higher profits. This likely occurred because

Question

Quizplus · Accepted Answer

Lowering prices can lead to higher profits if the decrease in price leads to a sufficient increase in the quantity sold, such that the additional revenue from selling more units (marginal revenue) exceeds the additional cost of selling those units (marginal cost). This scenario suggests that by decreasing parking prices, the troop attracted enough additional customers to increase overall profits, indicating that the marginal revenue from the additional sales was higher than the marginal cost associated with those sales.

The Town of Marshall's Boy Scout Troop 1099 Decreased Car