Suppose Island Bikes, a profit-maximizing firm, is the only bike rental company in a small resort town. The marginal cos

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Suppose Island Bikes A Profit Maximizing Firm Is The Only Bike Rental Company In A Small Resort Town The Marginal Cos 1 (45.73 KiB) Viewed 10 times

Suppose Island Bikes, a profit-maximizing firm, is the only bike rental company in a small resort town. The marginal cost to Island Bikes of renting out a bike is $3, and Island Bikes has no fixed costs. Each day Island Bikes has six potential customers, whose reservations prices are listed in the accompanying table. Customer A B с D E F Reservation Price ($/Rental) 22 16 12 8 6 4 Suppose Island Bikes knows that customers whose reservation prices are at least $10 always rent bikes before noon, while those whose reservation prices are below $10 never do so. If Island bikes can charge a different price in the morning and in the afternoon, then in the afternoon, it will rent out bike(s) and charge per bike.
Multiple Choice O 1; $8 2; $6 3; $4 5: $10 X