Question
1.Suppose a monopoly is producing its output in two different plants. The total cost function of each plant is given below. TC 1 = 1.5andTC
1.Suppose a monopoly is producing its output in two different plants. The total cost function of each plant is given below.
TC1= 1.5andTC2= 0.5
Where subscript 1 stands for plant 1 and subscript 2 denotes plant 2.
The inverse demand curve that the monopolist faces is as follows:
P = 70 - 0.5Q
Where Q stands for the total market quantity: Q = Q1+ Q2.
Determine the profit maximizing levels of output Q1and Q2and price.
Answer:
Calculate the price.
Answer:
Calculate the total profit.
Answer:
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Excel Applications For Accounting Principles
Authors: Gaylord SmithBruce Walz
4th Edition
1133388027, 9781133388029
