You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 500 − 2Q and C(Q) = 2,500 + 2Q2, respectively. a. What price–quantity combination maximizes your firm’s profits? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units b. Calculate the maximum profits. Instructions: Round your response to the nearest penny (two decimal places). $ c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price–quantity combination? multiple choice 1 Elastic Inelastic Unit elastic
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 500 − 2Q and C(Q) = 2,500 + 2Q2, respectively. a. What price–quantity combination maximizes your firm’s profits? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units b. Calculate the maximum profits. Instructions: Round your response to the nearest penny (two decimal places). $ c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price–quantity combination? multiple choice 1 Elastic Inelastic Unit elastic
Chapter8: Monopoly
Section: Chapter Questions
Problem 6SQ
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Question
You are the manager of a
a. What price–quantity combination maximizes your firm’s profits?
Instructions: Round your response to the nearest penny (two decimal places).
Price: $
Quantity: units
b. Calculate the maximum profits.
Instructions: Round your response to the nearest penny (two decimal places).
$
c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price–quantity combination?
multiple choice 1
-
Elastic
-
Inelastic
-
Unit elastic
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