Illustrate what is the socially efficient number of portrait

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Reference no: EM1353321

TotsPoses, Inc., a profit-maximizing business, is the only photography business in town that specializes in portraits of small children. George, who owns and runs TotPoses, expects to encounter an average of eight customers per day, each with a reservation price shown in the following table:

Customer Reservation Price ($ per photo)
A $5O
B $46
C $42
D $38
E $34
F $30
G $26
H $22

a) If the total cost of each photo portrait is $12, how much should George charge if he must charge a single price to all the customers? At this price, how many portraits will George Produce each day? What will be his economic profit?

b)How much consumer surplus is generated each day at this price?

c)What is the socially efficient number of portraits?

Reference no: EM1353321

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