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A firm manufactures and sells high quality business priters and ink toners. Each printer sells for $650 and each toner for $100. The average user keeps the priter for 5 years and consumes 4 toners every year. in response to a recent significant drop in printers sales( which will reduce future toner sales as well) the firm wants to lower the priter price to $500. Assume that income from toner sales occurs at year end and the firm's cost of capital is 10%. How much of an increase is needed in the toner price to cover the loss in priter price?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91229902

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