the pre-tax cost function for John's Shoe Repair is C(q)-150+10g-2g²+0.333q and it faces a specific tax of $20, what is the profit maximizing condition if the market price is p? Can you solve for a single, profit-maximizing q in terms of p? The proft-maximizing quantity in terms of p is (Property format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a fraction can be created with the / qa character)

the pre-tax cost function for John's Shoe Repair is C(q)-150+10g-2g²+0.333q and it faces a specific tax of $20, what is the profit maximizing condition if the market price is p? Can you solve for a single, profit-maximizing q in terms of p? The proft-maximizing quantity in terms of p is (Property format your expression using the tools in the palette. Hover over tools to see keyboard shortcuts. E.g., a fraction can be created with the / qa character)

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.10P

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If the pre-tax cost function for John's Shoe Repair is C(q) = 100 + 10q - q2 + (1⁄3q)2, and it faces a specific tax of = 10, what condition determines the profit-maximizing output if the market price is p? Can you solve for a single, profit-maximizing q in terms of p?
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A) The town of Dimmsdale is a popular tourist destination. The problem is, the tourists are not always considerate of the beautiful landscapes in and around Dimmsdale. Cleanup efforts cost Dimmsdale $5005 a day. The town has decided that it would be only fair to finance this by a “bed tax"-a per-room-per-night tax on every occupied tourist accommodation room. Denote this tax (in dollars per room per night) by t. Dimmsdale has many small hotels, guest houses, and B&Bs. The providers of these (“hoteliers") can all be assumed to be in perfect competition with each other, and they are all similar enough that tourists consider them perfect substitutes. The demand function for rooms is Qn(p) = 700 - 5p, where Q, is the number of rooms demanded and p is the price per room per night in dollars. The marginal cost of providing a room is c = $50 per night, 60% of which is labor costs (accruing to the workers of Sunnyside). The total number of rooms available is fixed at Q = 400 (this cannot be…
A) The town of Dimmsdale is a popular tourist destination. The problem is, the tourists are not always considerate of the beautiful landscapes in and around Dimmsdale. Cleanup efforts cost Dimmsdale $5005 a day. The town has decided that it would be only fair to finance this by a "bed tax"-a per-room-per-night tax on every occupied tourist accommodation room. Denote this tax (in dollars per room per night) by t. Dimmsdale has many small hotels, guest houses, and B&Bs. The providers of these (“hoteliers") can all be assumed to be in perfect competition with each other, and they are all similar enough that tourists consider them perfect substitutes. The demand function for rooms is Q,(p) 700 - 5p, where Q, is the number of rooms demanded and p is the price per room per night in dollars. The marginal cost of providing a room is c = $50 per night, 60% of which is labor costs (accruing to the workers of Sunnyside). The total number of rooms available is fixed at Q = 400 (this cannot be…