Shell Designs, Inc. faces the following monthly demand for its designer coffee mugs, which are hand-made using a special clay from imported from Costa Rica:
The average cost of producing each hand-made coffee mug is $8, and costs are constant.
-If Shell Designs decides to sell its mugs only at art and craft shows and employs a sales person with the uncanny-perhaps even supernatural-ability to look at buyers' eyes and know precisely the maximum price they will pay for a hand-made coffee mug, the company can sell _________ mugs per month under perfect (i.e., first-degree) price discrimination.

Question

Shell Designs, Inc. faces the following monthly demand for its designer coffee mugs, which are hand-made using a special clay from imported from Costa Rica:
  The average cost of producing each hand-made coffee mug is $8, and costs are constant.
-If Shell Designs decides to sell its mugs only at art and craft shows and employs a sales person with the uncanny-perhaps even supernatural-ability to look at buyers' eyes and know precisely the maximum price they will pay for a hand-made coffee mug, the company can sell _________ mugs per month under perfect (i.e., first-degree) price discrimination.

Quizplus · Accepted Answer

The Answer of Shell Designs, Inc. faces the following monthly demand for its designer coffee mugs, which are hand-made using a special clay from imported from Costa Rica:
  The average cost of producing each hand-made coffee mug is $8, and costs are constant.
-If Shell Designs decides to sell its mugs only at art and craft shows and employs a sales person with the uncanny-perhaps even supernatural-ability to look at buyers' eyes and know precisely the maximum price they will pay for a hand-made coffee mug, the company can sell _________ mugs per month under perfect (i.e., first-degree) price discrimination.