QUESTION 1A Discuss the importance of price elasticity of demand, income elasticity of demand and crossprice elasticity of demand to a sales manager selling soft drinks like Coca ColaB. If a firm faces the Marginal Cost schedule MC = 180 + 0.3Q²and the MR schedule is MR = 540= 0.6Q° and that Total Fixed costs are K65. What is the maximum profit it can make? Assumethat the second-order condition for maximum is metC. A firm knows that its price (P) and its output (Q) are related by the expression P = 80– 2QI) Express Q in tems of PTi) Use this expression to find an expression for TR in terms of Qlii) Find the value of Q which maximizes TRD)A manufacturer knows that:His TRis given by Revenue = 23Q - Q²%3DHis total cost of production is; Cost = 36+ 2Q+ 0.1Q?Where Qis the weekly production in thousands

Answered: A Discuss the importance of price…

A Discuss the importance of price elasticity of demand, income elasticity of demand and cross price elasticity of demand to a sales manager selling soft drinks like Coca Cola

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter11: Price And Output Determination: Monopoly And Dominant Firms

Section: Chapter Questions

Problem 3E

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