Answered: A.If D=40 – 6Q, find MR and P. B. If D…

A.If D=40 – 6Q, find MR and P. B. If D = 100 – 4Q and MC = 40, find profit maximizing output and price C.If D = 100 – 4Q, find MR and revenue maximizing output.

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter23: Profit Maximization

Section: Chapter Questions

Problem 3E

See similar textbooks

Similar questions

Complete the following table and identify the profit maximising and output. b. What is true about marginal revenue and marginal costs when profit is maximized. c. What would be the profit-maximizing level of output if price fell to $9?
The following graph shows Crest's demand curve, marginal-revenue (MR) curve, average-total-cost (ATC) curve, and marginal-cost (MC) curve. Use the black point (plus symbol) to indicate Crest's profit-maximizing output and price. (?) Price, Cost, Revenue Demand ATC O True MR Quantity of Crest Toothpaste True or False: Crest's profit is positive. + Profit Max
How are you going to maximize a profit if the price is given as 3 – 25D? A. Differentiate the price, then multiply the demand and subtract the total costs. Set equal to 0.B. Use the profit formula, then differentiate the total costs. Set equal to 0.C. Subtract the total costs from total revenue then differentiate. Set equal to 0.D. Differentiate the total price then subtract the total costs. Set it equal to 0.
1. Demand and Costs. Assume you are faced with the following demand curve,P = 20-0.5QWhere P is the dollar price per unit and Q is the number of units sold per month, and Q must be2 or more.a. Write the expression (definition) for this firm’s Total Revenue (TR)b. Write the expression for this firm’s marginal revenue (MR).c. What is Q when the P is zero?d. What is P when the Q is zero?e. Profit maximization occurs where MR=MC. If MC=$10 what is the profit maximizing levelof Q and P?f. As a business owner, you are thinking about lowering the price of this product. If youlower the price by 10% from your answer in e., will your TR rise or fall?
You live in a town with 300 Adults and 200 children, and you arc thinking about putting on a play to entertain your neighbors and make some money. A play has a fixed cost of $2,000, but selling an extra ticket has zero marginal cost. Here are the demand schedules for your two types of customer: a. To maximize profit, what price would you charge for an adult ticket? For a child's ticket?How much profit do you make?b. The city council passes a law prohibiting you from charging different prices to different customers. What price do you set for a ticket now? How much profit do you make?c. Who is worse off because of the law prohibiting price discrimination? Who is better off? (If you can, quantify the changes in welfare.)d. If the fixed cost of the play were $2,500 rather than $2,000, how would your answers to parts (a), (b), and (c) change?
Suppose the firm faces a demand curve for its product P=32-2Q, and the firm's costs of production and marketing are C(Q)=2Q^2. Find the following; a. The formula for profit piein terms of Q b. The first order condition(FOC) and the second order condition(SOC) for maximum total revenue c. The price and quantity that maximizes total revenue, and the corresponding value of the total revenue. d.The FOC and SOC for maximum profit e. The price and quantity that maximize profit and the corresponding value of profit. f. What would the competitive price and quantity be, assuming C(Q)=2Q^2 represented the industry cost function
a. Label the four curves in the graph above. The options are: MC, AC, D or MR What is the profit - maximizing output and price? Output: Price At the output in (b) what are the amounts of Total cost, total revenue and economic profit How much excess capacity exists? What will the presence of economic profits do? As a result, the demand in the graph will shift to the left, shift to the right or not shift
Assume that the following table represents the demand schedule for the product of your company: Price 0 10 20 30 40 50 60 70 80Quantity 160 140 120 100 80 60 40 20 0per day TotalRevenue (TR) a. Complete the table by calculating the total revenue (TR) figures. b. At what price and quantity is revenue maximised? c. Use the data above to draw the relevant demand curve and the corresponding total revenue(TR) values.d. Use your knowledge about the relationship between elasticity, prices and revenue how you would maximise the total revenue of a company that produces an inelastic good. Substantiate your answer with appropriate diagrams.
Use the table given to answer the questions. Demand for Air Fryers at Ally's shop Price (P) Quantity (Q) 140 110 80 50 I 2 3 4 Total Revenue 140 220 240 200 Marginal Revenue 140 80 20 -40 What is the Output Effect of decreasing the price of air fryers from $110 to $80? $ 20 Incorrect What is the Discount Effect of decreasing the price of air fryers from $110 to $80? $ 60 < Feedback Your answer to the first blank is incorrect. To find the output effect, you have to calculate the increase in revenue coming from the sale of that additional unit. Macmillan Learning
6. Guy Rope and his backing group, the Tent Pegs, have just finished recording their latest music CD. Their record company's marketing department determines that the demand for the CD is as follows: Price (€) Number of CDs €24 10 000 22 20 000 20 30 000 18 40 000 16 50 000 14 60 000 The company can produce the CD with no fixed cost and a variable cost of €0.15 per CD. a. Find total revenue for quantity equal to 10 000, 20 000 and so on. What is the marginal revenue for each 10 000 increase in the quantity sold? b. What quantity of CDs would maximize profit? What would the price be? What would the profit be? c. If you were Guy Rope's agent, what recording fee would you advise Guy to demand from the record company? Why?
Kali is a dot-com entrepreneur who has established a Web site at which people can design and buy aring. Kali pays $600 a month for a Web server and Internet connection. The rings that customers design are made to order by another firm, and Kali pays this firm $20 a ring. Kali has no other costs. The table shows the demand schedule for Kali's rings. What is Kali's profit-maximizing output, price, and economic profit? Price (dollars per ring) 100 Quantity (rings per month) 0 80 20 60 40 40 60 20 80 0 100 Kali's profit-maximizing output is rings a month. Kali's profit-maximizing price is $ a ring. Kali's economic profit is $ a month.
1.i) Assuming you are the managing director of a firm that produces goods: A,B and C .The price elasticity of demand for A is 1.2, for B it is 1.oo and C is 0.75. It is known that he's firm is experiencing serious cash flow problems and you have to increase total revenue as soon as possible. If you were in a position to set the prices for these goods, what would be your pricing strategy for each product ii) price falls from N$ 16 to N$ 12 per bottle and demand rises from 200 to 300 per bottle.calculate the PED using midpoint formula Output prices average (total)cost Total cost marginal cost Total profit/loss 10 10 -108 20 10 4 -48 30 10 5 3 40 10 6.20 40 50 10 8 60 60 10 10 60 2. i) fill in the gaps ii)in which market structure doess Johnson Electronics (Pty)Ltd operate? iii)what level of output maximizes the firms profit