Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

At Home Computers has determined that demand for their services is given by Q = 1200 - 20P and a cost equation given by C

At Home Computers has determined that demand for their services is given by Q = 1200 - 20P and a cost equation given by C = 125 + 5Q.

a. Determine the optimal price and quantity for the firm. (Price should be calculated to nearest cent. Example: $5.43 should not be rounded to $5.00.)

b. Suppose that costs change to C = 50 + 4Q. Determine the new optimal price and quantity. Explain why the results differ from those in part a.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Economics Markets and the Firm

Authors: William Boyes

2nd edition

618988629, 978-0618988624

More Books

Students also viewed these Economics questions

Question

What are the key elements of planning for any SEM campaign?? P/85

Answered: 1 week ago