Q. Address the following questions:
1. What is the elasticity of the demand for cookbooks bought this way?
2. Is the business worth pursuing so far?
3. Why or why not?
4. Assume that you expect to sell about 22,000 cookbooks per month online, and assume your overhead, technology, and equipment costs are fixed. What are your total costs?
5. What are your marginal costs?
6. What are the implications of operating in the short run and the long run?
7. As your business grows, how must you consider the issues regarding diminishing marginal returns and economies of scale?
8. What market structure have you entered, and why?
9. What can you do to guarantee success in this market?
10. Can you use price discrimination in this business?
11. What pricing strategy might you use?