Question
A firm estimates that it faces a demand curve with approximately the following relationship between price (P) in and quantity sold (Q): P =
A firm estimates that it faces a demand curve with approximately the following relationship between price (P) in £ and quantity sold (Q):
P = 100 – 0.01Q
Fixed costs are £40,000 and variable costs are £40 per unit.
- Find formulae for Total Revenue (TR) and Total Cost (TC)
- Find the formula for Profit (?)
- Find the breakeven quantities and hence the profit-maximizing quantity
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Management Science The Art Of Modeling With Spreadsheets
Authors: Stephen G. Powell, Kenneth R. Baker
4th Edition
978-1118517376, 9781118800348, 1118517377, 1118800346, 978-1118582695
