Problem
Sally sells seashells by the seashore. When Sally prices her shells at $7 each, she sells 5 shells every day. When she prices her shells at $6, she sells 6.
a. What is Sally's total revenue when she chooses to sell 5 shells (by pricing at $7)?
b. What is Sally's total revenue when she chooses to sell 6 shells (by pricing at $6)?
c. What is the marginal revenue Sally receives from deciding to sell a 6th shell?
d. The 6th shell sells for a price of $6. Why is the marginal revenue from selling a 6th shell so much lower than $6?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.