Roach Motors is the dominant used-car dealer in a small Midwestern city.After paying $50,000 for overhead, Roach Motors' cost per car is $500.There are 4 other small used-car lots in this town, but since they are not large enough to purchase cars through the same discount sources as Roach, each firm faces the cost function C = 5,000 + 600Q + 5Q².The demand for used cars is Q = 600 - P₃/10.Assuming Roach sets the market price so as to maximize its profit, how many cars will each of the follower firms supply? A)25 B)33 C)28 D)29 E)27

Question

Quizplus · Accepted Answer

The Answer of Roach Motors is the dominant used-car dealer in a small Midwestern city.After paying $50,000 for overhead, Roach Motors' cost per car is $500.There are 4 other small used-car lots in this town, but since they are not large enough to purchase cars through the same discount sources as Roach, each firm faces the cost function C = 5,000 + 600Q + 5Q².The demand for used cars is Q = 600 - P₃/10.Assuming Roach sets the market price so as to maximize its profit, how many cars will each of the follower firms supply? A)25 B)33 C)28 D)29 E)27

Roach Motors Is the Dominant Used-Car Dealer in a Small