A Firm Faces a Demand Function D(p), for Which the Revenue-Maximizing

question 92

Multiple Choice

A firm faces a demand function D(p) , for which the revenue-maximizing price is $16.The demand function is altered to 2D(p) .What is the new revenue-maximizing price?

• A)$8
• B)$16
• C)$32
• D)There is insufficient information to determine this.
• E)none of the above.

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Definitions:

Cost Of Goods Sold

Cost of goods sold (COGS) is the direct cost attributable to the production of the goods sold by a company, including the cost of materials and labor.

Gross Profit

The financial gain a company achieves after subtracting the cost of goods sold from its total revenue.

Operating Expenses

Expenses incurred in the normal operation of a business, excluding the cost of goods sold.

Net Sales

This is the amount of sales generated by a company after deducting returns, allowances for damaged or missing goods, and any discounts allowed.