The market demand for a monopoly firm is estimated to be: where is quantity demanded,P is price,M is income,and is the price of a related good.The manager has forecasted the values of M and will be $50,000 and $20,respectively,in 2021.The average variable cost function is estimated to be Total fixed cost in 2021is expected to be $4 million.The estimated marginal cost function is
A) SMC = 260 -0.03Q + 0.000015Q2.
B) SMC = 520 -0.06Q + 0.000003Q2.
C) SMC = 520 - 0.03Q + 0.000002Q2.
D) SMC = 260 - 0.015Q + 0.000005Q2.
E) none of the above
Correct Answer:
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