Use the following to answer questions : $$\begin{array}{l}
\text { Table: Prices and Demand }\
\begin{array} { l c }
\hline \begin{array} { l }
\text { Quantity } \
\text { of Hats } \
\text { Demanded }
\end{array} & \begin{array} { c }
\text { Price } \
\text { per Hat }
\end{array} \
\hline 0 & \$ 30 \
1 & 28 \
2 & 26 \
3 & 24 \
4 & 22 \
5 & 20 \
6 & 18 \
7 & 16 \
8 & 14 \
\hline
\end{array}
\end{array}$$
-(Table: Prices and Demand)Use Table: Prices and Demand.The Toronto Maple Leafs have a monopoly on Leafs Saints logo hats.The marginal cost of producing a hat is $18.The Leafs should produce _____ hats and charge _____ to maximize its profits.
A) 1;$28
B) 2;$26
C) 3;$24
D) 4;$22

Question

Use the following to answer questions : $$\begin{array}{l}
\text { Table: Prices and Demand }\
\begin{array} { l c } 
\hline \begin{array} { l } 
\text { Quantity } \
\text { of Hats } \
\text { Demanded }
\end{array} & \begin{array} { c } 
\text { Price } \
\text { per Hat }
\end{array} \
\hline 0 & \$ 30 \
1 & 28 \
2 & 26 \
3 & 24 \
4 & 22 \
5 & 20 \
6 & 18 \
7 & 16 \
8 & 14 \
\hline
\end{array}
\end{array}$$
-(Table: Prices and Demand)Use Table: Prices and Demand.The Toronto Maple Leafs have a monopoly on Leafs Saints logo hats.The marginal cost of producing a hat is $18.The Leafs should produce _____ hats and charge _____ to maximize its profits.
A) 1;$28
B) 2;$26
C) 3;$24
D) 4;$22

Quizplus · Accepted Answer

To maximize profit, the Leafs should produce where marginal cost equals marginal revenue. The marginal cost is $18, and the price per hat that exceeds this cost while maximizing revenue is $24 for 3 hats.

Use the Following to Answer Questions -(Table: Prices and Demand)Use Table: Prices and Demand