Chat with AI
Managerial Economics 2nd Edition by William Boyes
Edition 2ISBN: 978-0618988624Managerial Economics 2nd Edition by William Boyes
Edition 2ISBN: 978-0618988624 Exercise 13
The demand function is Q = 100 -.5 P. The cost function is TC = C = 100 + 60( Q ) +( Q ) 2
a. Find MR and MC.
b. Demonstrate that profit is maximized at the quantity where MR = MC.
c. Derive the relationship between marginal revenue and the price elasticity of demand, and show that the profit-maximizing price and quantity will never be the unit-elastic point on the demand curve.
d. Using the information in (b), demonstrate that the profit-maximizing price and quantity will never be in the inelastic portion of the demand curve.
a. Find MR and MC.
b. Demonstrate that profit is maximized at the quantity where MR = MC.
c. Derive the relationship between marginal revenue and the price elasticity of demand, and show that the profit-maximizing price and quantity will never be the unit-elastic point on the demand curve.
d. Using the information in (b), demonstrate that the profit-maximizing price and quantity will never be in the inelastic portion of the demand curve.
Explanation
Verified
Verified
Cost equation:
Cost equation is used to...
Managerial Economics 2nd Edition by William Boyes
Why don’t you like this exercise?
Other Minimum 8 character and maximum 255 character
Character 255
