Suppose That in Problem 2, the Demand Curve for Mineral

question 19

Multiple Choice

Suppose that in Problem 2, the demand curve for mineral water is given by p = 60 - 8q, where p is the price per bottle paid by consumers and q is the number of bottles purchased by consumers. Mineral water is supplied to consumers by a monopolistic distributor, who buys from a monopolist producer who is able to produce mineral water at zero cost. The producer charges the distributor a price of c per bottle, that will maximize the producer's total revenue. Given his marginal cost of c, the distributor chooses an output to maximize profits. The price paid by consumers under this arrangement is

• A) $30.
• B) $45.
• C) $3.75.
• D) $7.50.
• E) $15.

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Definitions:

Economic

Pertains to the production, distribution, and consumption of goods and services, and the management of resources.

Psychographic Differences

Variations in consumers' lifestyle, values, and personality traits that affect buying behaviors and can be used for market segmentation.

Multicultural Marketing

Marketing strategies specifically designed to appeal to a variety of cultural groups within a society.

Value Consciousness

The degree to which consumers are focused on obtaining good value for their money when purchasing products or services.