This is one big question with different parts!
I expect to need four turkeys to feed my 20 Thanksgiving guests.However, spiking the eggnog (adding alcohol) with bourbon willinduce my Thanksgiving guests to eat 25% less turkey. Turkeys cost$30 each, and the bourbon needed costs $20. How much money do Isave if I spike the eggnog? A. $0 B. $10 C. $30 D.$120
How cheap would turkeys have to be (per turkey) for me to nothave the incentive to spike the eggnog? A. free B. $10 C. $15 D.$20
A monopoly retailer makes a 50% margin on the $30 turkeys. Isthere a price for the bourbon that the retailer can set (for theamount of bourbon needed to spike the turkeys) such that I willpurchase the bourbon and the retailer will want to sell it, if thewholesale price of the bourbon is $10? (Assume the only added valuefrom spiking the eggnog is from the reduced cost of turkey and thatthis type of bourbon is only used to spike eggnog).
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