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A firm produces two goods in pure competition and has the following total revenue and total cost functions: TR = PQ + PQ2 and
A firm produces two goods in pure competition and has the following total revenue and total cost functions: TR = PQ + PQ2 and TC=2Q + Q Q2 +2Q Where, P = 12 and P = 18. Form the profit function and identity the critical value Q* Identify the critical value Q Construct the Hessian matrix and calculate the value of |H]. Calculate the value of |H|. Based on the values of Hessian, what can you say about the profit?
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Economics of Strategy
Authors: David Besanko, David Dranove, Mark Shanley, Scott Schaefer
6th edition
978-1118273630, 111827363X, 978-1118319185
