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Marginal Cost: Find the price at which the firm sells the product.

Suppose that a firm maximizes its total profits and has a marginal cost (MC) of production of $8 and the price elasticity of demand for the product it sells is (-)3. Find the price at which the firm sells the product. (Use equation (3012) and to maximize the profits, MR has to equal MC.

Please show all work and explain answer.

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Solution Summary

This solution includes formula and calculations for determining the price at which the firm sells the product.

$2.19