Ty's Sporting Goods is considering rewarding employees with profit sharing for good performance. Without the sharing plan, Ty's total cost function is: and his marginal cost function is: Ty can sell all his output for $500. Calculate Ty's optimal output level. What is his level of profits? If Ty implements the profit sharing plan, his total cost function is: and his marginal cost function is: If the profit sharing plan entitles his employees to 25% of the profits, should Ty institute the plan?

Question

Ty's Sporting Goods is considering rewarding employees with profit sharing for good performance. Without the sharing plan, Ty's total cost function is:  and his marginal cost function is:  Ty can sell all his output for $500. Calculate Ty's optimal output level. What is his level of profits? If Ty implements the profit sharing plan, his total cost function is:  and his marginal cost function is:  If the profit sharing plan entitles his employees to 25% of the profits, should Ty institute the plan?

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The Answer of Ty's Sporting Goods is considering rewarding employees with profit sharing for good performance. Without the sharing plan, Ty's total cost function is:  and his marginal cost function is:  Ty can sell all his output for $500. Calculate Ty's optimal output level. What is his level of profits? If Ty implements the profit sharing plan, his total cost function is:  and his marginal cost function is:  If the profit sharing plan entitles his employees to 25% of the profits, should Ty institute the plan?

Ty's Sporting Goods Is Considering Rewarding Employees with Profit Sharing