A perfectly competitive firm has a demand function Pd (Q) = 121 and costs given as TC (Q) = Q - 15Q² + 175Q. Find the output, Q at which profit is maximised? %3D %3D O 18 O 14 O 2 O 10
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- What is the profit maximization for apex firm if we have the following data quantitiy /unit ={0,1,2,3,4,5,6,7,8,9,10} total variable cost =[0,100,180,220,300,390,500,640,800,1000,1250} 2. If the market price dropped to $80, what is the profit-maximizing level of output? What is Apex’s profit (or loss) in this case?3. If the market price dropped further to $40, what is the profit-maximizing level of output? What is Apex’s profit (or loss) in this case?4. Comment on your answers to parts (2) and (3)Looking at the Table, Profit, Cost and Revenue Functions, Quant is the quantity of output, C(Q) is the Total Cost of production for corresponding quantities of output, R(Q) is the corresponding Total Revenue at each level of output Q, if all output is sold and PRF(Q) is the Total Profit for each corresponding output level. PRF(Q) is calculated as R(Q)-C(Q). Using this information, does the company make its highest profit where R(Q) is highest? a. No, because the highest possible revenue may be at an output level where the cost of output may exceed the revenue generated at that output level. In this problem, the highest profit is at output level 15 Ob. Yes, because there is no way that cost can exceed revenue when revenue is maximized. Cc. No, because the highest possible revenue may be at an output level where the cost of output may exceed the revenue generated at that output level. In this problem, the highest profit is at output level 10 or 12 or in between. Od. Yes, because the…An industry with many stores offer laminating as a service to their customers. Suppose that each store that offers this service has a cost function C(q)=50+0.5q+0.08q2 and a marginal costMC=0.5+0.16q. Suppose the going rate for laminating is R8.50 per sleeve which each store is compelled to charge. 1. Is the industry in long run equilibrium? Use calculations to either prove or disprove your findings.
- 34 A firm with two plants, A and B, has the following estimated demand and marginal cost functions: Qd=120 - 10P MCA = 4 + (1/5) QA MCB=6+ (1/10) QB What is the firm's total marginal cost function? Multiple Choice MC = 24+ (1/50)Q MC = 10 + (3/15) Q MC = (80 / 15) + (1/15) Q MC = 2 + (1/10)Q OMCQ 25 A price-setting firm faces a demand curve described by the equation P = 100 - 5Q and its total production costs are given by the equation TC = 12 + 30Q. With this revenue and cost information, if the firm aims to maximise total profits, it should set price P at: A 65 В I do not want to answer this question. C 95 D 5 E 7 F 35Consider the table of firm costs and revenue below. It may be useful to calculate the missing values. QMCMR TC TR 1 3 5 13 5 2 2 5 15 10 3 3 5 4 5 5 5 8 5 6 12 5 If the firm chooses Q to maximize short-run profit, what will the profit be? IT = -3 O T = 3 IT = -6 IT = 6
- Suppose the marginal cost and marginal revenue (in ¢000) for a product produced by a company is estimated to beMC=q+35 MR=560+22q−q2Where q is the quantity produced and the firm’s break-even is 5 units per weekYou are Required to1. determine the total cost and the total revenue function in terms of q.2. estimate the output at which profit is maximize3. calculate the maximum profit(b) You are the CEO for a lightweight compasses manufacturer. The demand function for the lightweight compasses is given by p 40 – 4q²where q is the number of lightweight compasses produced in millions. It costs the company $15 to make a lightweight compass. (1) Write an equation giving profit as a function of the number of lightweight compasses produced. (11) At the moment the company produces 2 million lightweight compasses and makes a pre of $18,000,000, but you would like to reduce production. What smaller number of lightweight compasses could the company produce to yield the same profit? Σ BIUG G |卡 三 = 9 ..Q3. The management of a manufacturing company has the following information: Revenue function: R = 2700Q – 15Q? Profit-maximizing price is 1500 units. 1\ Using the above information, determine the following: i. Profit-maximizing quantity. ii. Revenue-maximizing quantity. 2\ Suggest a cost function which results in a maximum profit value to be between OMR (25000 and 65000), write the maximum profit value.
- If the profit function is T = - Q² + 7Q -10 What is the value of the maximum profit Select one: C a. Tmax. = -3.5 b. Tmax. = 2.25 C C. Tmax. =7 d. Tmax. = 3.53. Gazelle Corp, a sports shoe firm, is currently selling 800 pairs of a certain shoe per month. It is currently charging a price of £40, but this has recently been reduced from £45, because sales were only reaching 750 units per month. Its total costs are £28,000 per month, and these have risen £1500 due to the increase in sales. a) Derive the cost and demand functions for the firm, assuming these are both linear. b) Calculate the price elasticity of demand at the current price. c) Comment on the firm's existing strategy in terms of profit maximization, without doing any calculations. d) Calculate the profit-maximizing price and output. e) Calculate the amount of profit that the firm is currently foregoing.2) A perfectly competitive market has demand given by Qp market, and cach firm has a different cost structure as shown below: 4850-70P.There are four firms in this TC (q) = 5000 + 4q + 0.02q? MC(q) = 4+ 0.04q Client 9 & Co. TC(q) = ? MC(q) = 1+0.05q BTVS Inc 6000 +q + 0.025q TC(q) = 5000 + 2q + 0.02q? MC(q) = 2+ 0.04q The Fred Firm TC (q) = 15000 + 5q + 0.005q2 MC(q) = 5+0.01q OTT (a) What is the market price and market quantity? Hint: Start by determining the individual supply for each firm, and then add them to get the market supply (b) How many units does cach firm produce, and how much profit does each firm make? (c) In the long-run competitive equilibrium, what is the market price and market quantity? (d) In the long-run competitive equilibrium, how many units docs cach firm produce, and how much profit docs cach firm make?