3. Suppose that American Borax is a monopolist and that the worldwide demand for borax is Q...

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3. Suppose that American Borax is a monopolist and that the worldwide demand for borax is Q = 100 – P where Q is tons of borax and P is the price per ton. The total cost function for American Borax is TC = 10Q + 0.5 Q 2 .

a. Write out the firm’s total revenue as a function of Q.

b. What is the profit function for American Borax?

c. Find the firm’s profit-maximizing quantity by applying calculus to the profit function.

d. Find American Borax’s profit-maximizing price and profit.

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Microeconomics

ISBN: 9780716759751

1st Edition

Authors: Austan Goolsbee, Steven Levitt, Chad Syverson

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