Answered step by step
Verified Expert Solution
Link Copied!

Question

...
1 Approved Answer

Suppose a competitive firm's total costs as a function of its output q level: C(q)=1/3q^3 10q^2 + 102q + 100. Answer each of the following

Suppose a competitive firm's total costs as a function of its output q level: C(q)=1/3q^3 10q^2 + 102q + 100. Answer each of the following questions based on the above information. Round your answers to the nearest second decimal place (i.e., 0.01).

a). At what level of output q are the firm'saverage variable costsminimized?

b). What is the threshold level of the good price, below which the firm produces q = 0 output in the short run? (need numerical answer)

c). Assuming that the firm faces a price of p = $38 per unit sold, what level of output q maximizes the firm's profits?

d). Maintaining the assumption that the firm faces a price of p= $38 per unit sold, calculate the firm's maximized profits.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Global Strategy

Authors: Mike W. Peng

5th Edition

9780357512364

Students also viewed these Economics questions