Suppose Ned’s Beds does not have to lower the price in order to sell more beds. Specifically, suppose Ned can sell all the beds he wants at a price of $275 per bed. a. What will Ned’s MR curve look...

Suppose Ned’s Beds does not have to lower the

price in order to sell more beds. Specifically,

suppose Ned can sell all the beds he wants at a price

of $275 per bed.

a. What will Ned’s MR curve look like? (Hint:

How much will his revenue rise for each

additional bed he sells?)

b. In Table 1, how would you change the numbers

in the marginal revenue column to reflect the

constant price for beds?

c. Using the marginal cost and new marginal

revenue numbers in Table 1, find the number

of beds Ned should sell.