A firm produces two products, x and y, and the production process is such that one unit of x is always obtained with one unit of y. If the demand curves for x and y are estimated to be:
Q_x = 85 - P_x so that MR_x = 85 - 2Q_x)
Q_y = 110 - P_y so that MR_y = 110 - 2Q_y)
and the marginal cost of production is MC = 25 + .25Q_j, where Q_j consists of one unit of each product, how much of product x and product y should the firm sell in order to maximize profit?

Question

Quizplus · Accepted Answer

The Answer of A firm produces two products, x and y, and the production process is such that one unit of x is always obtained with one unit of y. If the demand curves for x and y are estimated to be: Q_x = 85 - P_x so that MR_x = 85 - 2Q_x) Q_y = 110 - P_y so that MR_y = 110 - 2Q_y) and the marginal cost of production is MC = 25 + .25Q_j, where Q_j consists of one unit of each product, how much of product x and product y should the firm sell in order to maximize profit?

A Firm Produces Two Products, X and Y, and the Production