Ajax Cleaning Products is a medium-sized firm operating in an industry dominated by one large firm—Tile King. Ajax produces a multiheaded tunnel wall scrubber that is similar to a model produced by Tile King. Ajax decides to charge the same price as Tile King to avoid the possibility of a price war. The price charged by Tile King is $20,000.

Ajax has the following short-run cost curve:

TC = 800,000 − 5,000Q + 100Q2

a. Compute the marginal cost curve for Ajax.

b. Given Ajax’s pricing strategy, what is the marginal revenue function for Ajax?

c. Compute the profit-maximizing level of output for Ajax.

d. Compute Ajax’s total dollar profits.