Question

The campus bookstore knows from the past several semesters that a certain elementary statistics book has a demand that is approximated by a normal distribution with a mean of 250 and a standard deviation of 40. They buy these books for $105 each and sell them to unsuspecting undergraduates at $222 each. All demand for this book is realized by the middle of the semester, at which point the bookstore bundles them up and sells them to a vendor in another country for $40 each. What is the marginal profit for a single elementary statistics book

Answer 1

Answer:

$117

Step-by-step explanation:

Given that:

They buy these books for $105 each and sell them to unsuspecting undergraduates at $222 each

Marginal Profit = Marginal Revenue – Marginal Cost.

Marginal Profit = $222 - $105

Marginal Profit = $117

the marginal profit for a single elementary statistics book $117

For the remaining unsold books in the middle of the semester he bundles them up and sells to vendor in another country for $40 each for which he suffers a marginal loss of $105 - $40 = $65 each