Question one

Dennis Ltd observes that its marginal revenue is given by the expression 20-2q while the marginal cost is given by the expression 4q-10. Its fixed costs are Sh.30. q represents quantities of output produced and sold. Required: Determine the following:

1. Total revenue equation (3 marks)
2. Total cost equation (3 marks)
3. Profit equation (3 marks)
4. Profit maximizing Output and Price (5 marks)
5. The maximum profit (3 marks)
6. Breakeven output (3 marks)

Question two

1. The marginal cost and marginal revenue of a commodity of a firm are given by. Calculate the profit when 10 units are sold given that the total cost at zero output is zero. (5 marks)