Using the linear approximation system to estimate the profit maximizing price requires that the managers know the costs of production and:
A) the production function.
B) one price and quantity of demand.
C) two prices and quantities of demand.
D) decision-making process of the marketplace.

Question

Quizplus · Accepted Answer

To estimate the profit-maximizing price using linear approximation, managers need to know two prices and quantities of demand to determine the demand curve's slope and intercept.

Using the Linear Approximation System to Estimate the Profit Maximizing