People will buy at places that are cheap and sell at more expensive prices because:
- The transactions costs would be too high.
- There's little resale market for used Big Macs.
- They would be expensive to transport.
- They're perishable.
<h3>What is transactions cost?</h3>
Transactions cost simply mean the expenses that are incurred when one buys or sells a particular product.
In this case, the above options are the reasons why people are unlikely to buy Big Macs in the places where they are relatively cheap according to purchasing power parity.
Learn more about transactions cost on:
brainly.com/question/1405573
Answer:
firstly; the area to start with. find out more about the place. Their income and the rate at which goods are sold there.
Answer:
Value of x maximising profit : x = 5
Explanation:
Cost : C(x) = x^3 - 6x^2 + 13x + 15 ; Revenue: R(x) = 28x
Profit : Revenue - Cost = R(x) - C(x)
28x - [x^3 - 6x^2 + 13x + 15] = 28x - x^3 + 6x^2 - 13x - 15
= - x^3 + 6x^2 + 15x - 15
To find value of 'x' that maximises total profit , we differentiate total profit function with respect to x & find that x value.
dTP/dx = - 3x^2 + 12x + 15 = 0 ► 3x^2 - 12x - 15 = 0
3x^2 + 3x - 15x - 15 = 0 ► 3x (x +1) - 15 (x + 1) = 0 ► (x+1) (3x-15) = 0
x + 1 = 0 ∴ x = -1 [Rejected, production quantity cant be negative] ;
3x - 15 = 0 ∴ 3x = 15 ∴ x = 15/3 = 5
Double derivate : d^2TP/dx^2 = - 6x + 12
d^2TP/dx^2 i.e - 6x + 12 at x = 5 is -6(5) + 12 = - 30+ 12 = -8 which is negative. So profit function is maximum at x = 5