If you set the selling price of each unit at $16, the expected profit per customer is: $6.
Using this formula
Expected profit=Lowest amount willing to pay-Marginal cost
Where:
Lowest amount willing to pay=$10
Marginal cost=$4
Let plug in the formula
Expected profit=$10 - $4
Expected profit= $6
Therefore if you set the selling price of each unit at $16, the expected profit per customer is: $6.
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