If a firm finds that advertising increases the total number of customers, for how many hours should it advertise? Assume that each extra customer spends an average of $10 at the store, and an extra hour of advertising costs the firm $200.

If a firm finds that advertising increases the total number of customers, for how many hours should it advertise? Assume that each extra customer spends an average of $10 at the store, and an extra hour of advertising costs the firm $200.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter13: Monopoly And Antitrust

Section: Chapter Questions

Problem 13P

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Question

Thinking at the Margin
0
1
2
3
4
5
Hours of
advertising
300
350
380
400
410
415
Total number of
customers
If a firm finds that advertising increases the total number of
customers, for how many hours should it advertise? Assume that
each extra customer spends an average of $10 at the store, and
an extra hour of advertising costs the firm $200.

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