Question
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 300 2 Q and C
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions asP = 300 2Q and C(Q) = 2,500+ 3Q2, respectively.
a. What price-quantity combination maximizes your firm's profits?
Instructions: Round your response to the nearest penny (two decimal places).
Price: $
Quantity: units
b. Calculate the maximum profits.
Instructions: Round your response to the nearest penny (two decimal places).
$
c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price-quantity combination?
multiple choice 1
- Inelastic
- Unit elastic
- Elastic
d. What price-quantity combination maximizes revenue?
Instructions: Round your response to the nearest penny (two decimal places).
Price: $
Quantity: units
e. Calculate the maximum revenues.
Instructions: Round your response to the nearest penny (two decimal places).
$
f. Is demand elastic, inelastic, or unit elastic at the revenue-maximizing price-quantity combination?
multiple choice 2
- Elastic
- Unit elastic
- Inelastic
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Environmental Economics And Policy
Authors: Thomas H Tietenberg
5th Edition
0321348907, 9780321348906
