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6. (6 marks) Suppose Sol Bus is the only long-distance bus service provider in town. She has a cost function of C = 20,000 5Q2

6. (6 marks)

Suppose Sol Bus is the only long-distance bus service provider in town. She has a cost function of C = 20,000 5Q2 + 500Q.

Furthermore, estimate shows that the inverse market demand for long-distance bus services in town is P = 14,500 75Q.

Calculate the profit-maximizing output level and the price of Sol Bus.

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