Suppose Campus Books, a Profit-Maximizing Firm, Is the Only Supplier

question 64

Multiple Choice

Suppose Campus Books, a profit-maximizing firm, is the only supplier of the textbook for a given class. The marginal cost of supplying each book is constant and equal to $10, and Campus Books has no fixed costs. The table shows the reservation prices of the eight students enrolled in the class.  
$$\begin{array} { | c | c | } \hline \text { Custamer } & \begin{array} { c } \text { Reservutian Price } \\\text { (S/Bank) }\end{array} \\\hline \mathrm { Q } & 60 \\\hline \mathrm { R } & 54 \\\hline \mathrm { S } & 48 \\\hline \mathrm { T } & 42 \\\hline \mathrm { U } & 36 \\\hline \mathrm { V } & 30 \\\hline \mathrm { W } & 24 \\\hline \mathrm { X } & 18 \\\hline\end{array}$$ If Campus Books is permitted to charge 2 prices, and the bookstore knows customers with a reservation price above $30 never bother with coupons, whereas those with a reservation price of $30 or less always use them, then what will be the bookstore's total economic profit?

• A)$158
• B)$154
• C)$150
• D)$130

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Definitions:

Unconditioned Response

An automatic and involuntary reaction to a stimulus that occurs naturally, without any prior learning.

Classical Conditioning

A behavioral training method where the consistent pairing of two stimuli results in a response originally elicited by the second stimulus being ultimately elicited by the first stimulus.

Unconditioned Stimuli

Stimuli that naturally and automatically trigger a response without any prior learning.

Conditioned Stimuli

Stimuli that have become associated with a particular response through conditioning, typically in the context of classical conditioning.