Fiona Wants to Sell a Local Advertising Calendar

question 22

Multiple Choice

Fiona wants to sell a local advertising calendar. There are 1,000 households in her community, and she estimates that 30 percent will buy a calendar. The printing company will charge a $100 setup fee, and calendars will cost $4.00 each to print. What price will she need to charge to cover all costs and make a $500 profit?

• A) $6.00
• B) $7.00
• C) $8.00
• D) $9.00
• E) $10.00

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Definitions:

Homogeneous Oligopolist

A firm in a market structure where only a few sellers offer products or services that are essentially identical, leading to limited competition.

Highly Concentrated Industry

An industry dominated by a small number of firms, leading to reduced competition and potentially higher prices for consumers.

Pittsburgh Plate Glass

Pittsburgh Plate Glass, known today as PPG Industries, is an American global supplier of paints, coatings, optical products, specialty materials, chemicals, glass, and fiberglass.

Differentiated Oligopoly

A market structure in which a few firms dominate the market, and each firm offers a product or service that is slightly different from that of its competitors.