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Given a demand function for a monopoly firm as p=20-q and cost function as C=q +8q+2 (a) What output level maximizes total profit and
Given a demand function for a monopoly firm as p=20-q and cost function as C=q +8q+2 (a) What output level maximizes total profit and what are the corresponding values of price, profit and total revenue? (5marks) (b) What output level maximizes sales in value and what are the corresponding values of price, profit and total revenue?(5marks) (c) Prove that the profit of the firm is maximum. (5marks)
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Step: 1
a To find the output level that maximizes total profit we need to set up the profit function and find the output level that maximizes it Given Demand ...Get Instant Access to Expert-Tailored Solutions
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Step: 3
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