Question

1. For the demand equation P = 36 - 2Q, what Price will maximize total revenue?...

1. For the demand equation P = 36 - 2Q, what Price will maximize total revenue?

2. If TC = 40 + 6Q TC=40+6Q and E_P = −3 EP​=−3 what is the optimal price to be charged?

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Q1

the total revenue is maximized when marginal revenue is zero

marginal revenue is the change in total revenue and it a change in function found by differentiation

TR=P*Q=36Q-2Q^2

MR=dTR/dQ=36-4Q=0

4Q=36

Q=9

P=36-2*9=18units

the total revenue is maximum when P=$18

-------------

Q2

A marginal cost is a change in total cost and a change in function found by differentiation

MC=dTC/dQ=6

P=MC/(1+(1/E))

P=price

MC=marginal cost

E=elastcity

P=6/(1+(1/(-3)))

=$9

the optimum price is $9.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Price Discrimination Suppose the demand for ticket sales is given by the following function: P =315−2Q...
Price Discrimination Suppose the demand for ticket sales is given by the following function: P =315−2Q Further suppose that marginal cost is 3Q and total cost is 3/2Q^2 a) Find the profit maximizing price and quantity. 1 b) What is the maximum profit? Suppose now that the ticket seller can price discriminate by checking IDs. There are two demands in the market: Adult Demand: PA = 315 − 3Q Student Demand: PK = 315 − 6Q Again, suppose that marginal...
A firms demand function for a good is given by P = 107-2Q and their total...
A firms demand function for a good is given by P = 107-2Q and their total cost function is given by TC = 200+3Q. (using for 6.1 to 6.4) 6.1 Obtain an expression for total revenue (price X quantity) in terms of Q 6.2 For what values of Q does the firm breakeven? 6.3 Illustrate the answer to (ii) using sketches of the total cost function, the total revenue function and the profit function 6.4 From the graph estimate the...
the inverse supply is p=.2Q-20 and inverse demand is P=40-.2Q. there is a price floor of...
the inverse supply is p=.2Q-20 and inverse demand is P=40-.2Q. there is a price floor of $12, what is the producer and consumer surplus
Assume the demand schedule below and TC function below to find maximize profit, Total Revenue (TR),...
Assume the demand schedule below and TC function below to find maximize profit, Total Revenue (TR), Total Cost(TC), and max profit. Using the MR=MR (Marginal Revenue) approach or Excel (Solver). P = 10 - .5Q TC = 10 + Q - .4Q2
1) The inverse demand curve a monopoly faces is p=110−2Q. The​ firm's cost curve is C(Q)=30+6Q....
1) The inverse demand curve a monopoly faces is p=110−2Q. The​ firm's cost curve is C(Q)=30+6Q. What is the​ profit-maximizing solution? 2) The inverse demand curve a monopoly faces is p=10Q-1/2 The​ firm's cost curve is C(Q)=5Q. What is the​ profit-maximizing solution? 3) Suppose that the inverse demand function for a​ monopolist's product is p = 7 - Q/20 Its cost function is C = 8 + 14Q - 4Q2 + 2Q3/3 Marginal revenue equals marginal cost when output equals...
Example 1: Suppose a monopolist faces an inverse demand function as p = 94 – 2q....
Example 1: Suppose a monopolist faces an inverse demand function as p = 94 – 2q. The firm’s total cost function is 1.5q2 + 45q + 100. The firm’s marginal revenue and cost functions are MR(q) = 90 – 4q and MC(q) = 3q + 45. How many widgets must the firm sell so as to maximize its profits? At what price should the firm sell so as to maximize its profits? What will be the firm’s total profits?
(3)The demand (P) and total cost ( TC) functions for commodity Z can be represented by...
(3)The demand (P) and total cost ( TC) functions for commodity Z can be represented by the following equations: P = 1400 – 7.5Q TC= Q^3-6Q^2+140Q+750 (a)Graph the marginal revenue and marginal cost for Q = 0, 5, 10, 15, 20 and 25 (b)What is the profit maximizing output for this firm? (c)Find the price the firm will sell its output. (d)If the market clears, find the profit the firm could earn.
Suppose the demand and supply functions for a product are P= 2800-8q-1/3q^2 and p = 400+2q,...
Suppose the demand and supply functions for a product are P= 2800-8q-1/3q^2 and p = 400+2q, respectively, where p is in dollars and q is the number of units. Find q that will maximize the tax revenue
Given the following information for a monopolistic competitor: Demand: P = 68 – 7(Q) Marginal revenue:...
Given the following information for a monopolistic competitor: Demand: P = 68 – 7(Q) Marginal revenue: MR = 68 – 14(Q) Marginal cost: MC = 2(Q) + 8 Average total cost at equilibrium is 22 1. At what output (Q) will this firm maximize profit?     2. At what price (P) will this firm maximize profit?     3. What is the total revenue (TR) earned at this output level?    4. What is the total cost (TC) accrued at this output?     5. What...
Suppose the inverse demand equation for taxi is P = 100 − 2Q and the inverse...
Suppose the inverse demand equation for taxi is P = 100 − 2Q and the inverse supply equation is P = 2Q. Suppose there’s a policy that restricts the price to be at least $65. Which of the following statements is correct? A. The market equilibrium price will be 70. B. There will be no excess demand or excess supply. C. There will be an excess demand of 15 units. D. There will be an excess supply of 15 units....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT