ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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11.6 #2. PLEASE ANSWER LETTERS A, B, C, PLEASE SHOW ALL WORK. DO NOT SKIP ANY LETTERS, EVERYTHING MUST BE ANSWERED. THANK YOU 

2. A two-product firm faces the following demand and cost functions:
Q2 = 35 - P₁ - P₂ C = Q² +20/+10
P2
Q₁ = 40 - 2P₁1 - P₂
(a) Find the output levels that satisfy the first-order condition for maximum profit. (Use
fractions.)
(b) Check the second-order sufficient condition. Can you conclude that this problem
possesses a unique absolute maximum?
(c) What is the maximal profit?
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Transcribed Image Text:2. A two-product firm faces the following demand and cost functions: Q2 = 35 - P₁ - P₂ C = Q² +20/+10 P2 Q₁ = 40 - 2P₁1 - P₂ (a) Find the output levels that satisfy the first-order condition for maximum profit. (Use fractions.) (b) Check the second-order sufficient condition. Can you conclude that this problem possesses a unique absolute maximum? (c) What is the maximal profit?
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