Figure 15-17

Your college decides to offer a psychology course as a MOOC that can be taken by students anywhere in the world, whether they are actually enrolled in your college or not. The demand and cost situation for the MOOC is shown in the figure.
-Refer to Figure 15-17.The dean of the college argues: "I think the course should be priced to maximize the profit the college earns, so these funds can be used to pay some other expenses." How much profit (or loss)will the college make on the course if it charges this price?

Question

Figure 15-17
  
Your college decides to offer a psychology course as a MOOC that can be taken by students anywhere in the world, whether they are actually enrolled in your college or not. The demand and cost situation for the MOOC is shown in the figure.
-Refer to Figure 15-17.The dean of the college argues: "I think the course should be priced to maximize the profit the college earns, so these funds can be used to pay some other expenses." How much profit (or loss)will the college make on the course if it charges this price?

Quizplus · Accepted Answer

To maximize profit, the college should set the price where marginal cost equals marginal revenue. The profit at this price point is $450,000.

Figure 15-17 Your College Decides to Offer a Psychology Course as a a Psychology