Johnny Rockabilly has just finished recording his latest CD. The company can produce the CD with no fixed cost and a variable cost of $5 per CD. A) Find total revenue for quantity equal to 10,000, 20,000, and so on. What is the marginal revenue for each 10,000 increase in the quantity sold? B) What quantity of CDs would maximize profit? What would the price be? What would the profit be? C) If you were Johnny"s agent, what recording fee would you advise Johnny to demand from the record company? Why?

Larry, Curly, and Moe run the only saloon in town. Larry wants to sell as many drinks as possible without losing money. Curly wants the saloon to bring in as much revenue as possible. Moe wants to make the largest possible profits. Using a single diagram of the saloon's demand curve and its cost curves, show the price and quantity combinations favored by each of the three partners. Explain.