Find the Price That Maximizes the Profit If the Demand

question 190

Multiple Choice

Find the price that maximizes the profit if the demand for a product varies from 1,000 at a price of $7 each to 7,000 at a price of $1 each. Also, 5,000 could be supplied at a price of $9 each, whereas only 3,000 could be supplied for $5 each. The graph for this supply-demand problem is given below.

• A) $11
• B) $5
• C) $4
• D) $8
• E) $10

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Definitions:

Account Affected

The specific ledger account impacted by a financial transaction, indicating where changes in value are recorded.

Debit and Credit

Accounting terms used to record transactions in the accounts, where debits increase asset or expense accounts and decrease liability, equity, or revenue accounts, and credits do the opposite.

Operations

The day-to-day activities involved in running a business that lead to the production of goods and delivery of services.

Journalizing

Journalizing is the process of recording transactions in a company's journal prior to posting them to the general ledger.