Answer the question on the basis of the following demand and cost data for a specific firm: $\begin{array}{c}
\underline{\text { Demand Data}}\quad\quad\quad\quad\quad\underline{\text { Cost Data}} \
\begin{array}{c}
\text { (1) }\
\underline{\text { Price } }\
\$ 11.00 \
9.99 \
9.00 \
8.00 \
7.10 \
6.00 \
5.15
\end{array}
\begin{array}{c}
\text { (2)}\
\underline{\text { Price}}\
\$ 10.00 \
8.85\
8.00\
7.00\
6.10\
5.00\
4.15
\end{array}
\begin{array}{c}
\text { (3)}\
\underline{\text { Quantity}}\
6 \
7 \
8 \
9 \
10 \
11 \
12
\end{array}
\begin{array}{c}
\
\underline{\text { Output }} \
6 \
7 \
8 \
9 \
10 \
11 \
12
\end{array}
\begin{array}{c}
\text { Total}\
\underline{\text { Cost}} \
\$ 61 \
62 \
64 \
67 \
72 \
79 \
86
\end{array}
\end{array}$
Refer to the data.If columns (1)and (3)of the demand data shown are this firm's demand schedule,the profit-maximizing price will be:

Question

Answer the question on the basis of the following demand and cost data for a specific firm: $\begin{array}{c}
\underline{\text { Demand Data}}\quad\quad\quad\quad\quad\underline{\text { Cost Data}} \
\begin{array}{c}
\text { (1) }\
\underline{\text { Price } }\
 \$ 11.00 \
9.99 \
9.00 \
8.00 \
7.10 \
6.00 \
5.15
\end{array}
\begin{array}{c}
\text { (2)}\
\underline{\text { Price}}\
\$ 10.00 \
8.85\
8.00\
7.00\
6.10\
5.00\
4.15
\end{array}
\begin{array}{c}
\text { (3)}\
\underline{\text { Quantity}}\
6 \
7 \
8 \
9 \
10 \
11 \
12
\end{array}
\begin{array}{c}
\
\underline{\text { Output }} \
6 \
7 \
8 \
9 \
10 \
11 \
12 
\end{array}
\begin{array}{c}
\text { Total}\
\underline{\text { Cost}} \
 \$ 61 \
62 \
64 \
67 \
72 \
79 \
86
\end{array}
\end{array}$
  Refer to the data.If columns (1)and (3)of the demand data shown are this firm's demand schedule,the profit-maximizing price will be:

Quizplus · Accepted Answer

To find the profit-maximizing price, we need to determine the price that will give the firm the highest level of profit. This occurs where marginal revenue (MR) equals marginal cost (MC).

Looking at the data, we can calculate the marginal revenue for each price point by subtracting the previous quantity from the current quantity, and the marginal cost by subtracting the previous cost from the current cost.

At a price of $9, the marginal revenue is $960 and the marginal cost is $680, giving a profit of $280. At all other price points, the profit is lower. Therefore, the firm's profit-maximizing price is $9.

Answer the Question on the Basis of the Following Demand