Producers in three countries have formed a cartel to sell a highly-priced product. Suppose the world demand for the product is consistent with the equation: P=80-0.005QT NB: QT is the total cartel sales. The producers have managed to maximise profit at a price of R70 per unit. Suppose the members have the following total cost functions; Member 1: TC=7382 + 10Q + 0.05Q2 Member 2: TC= 9374 + 20Q + 0.02Q2 Member 3: TC=7432 + 30Q + 0.03Q2 : Derive: a) Marginal revenue b) Output of member 1,2 and 3 c) Total cartel output.
Producers in three countries have formed a cartel to sell a highly-priced product. Suppose the world demand for the product is consistent with the equation: P=80-0.005QT NB: QT is the total cartel sales. The producers have managed to maximise profit at a price of R70 per unit. Suppose the members have the following total cost functions; Member 1: TC=7382 + 10Q + 0.05Q2 Member 2: TC= 9374 + 20Q + 0.02Q2 Member 3: TC=7432 + 30Q + 0.03Q2 : Derive: a) Marginal revenue b) Output of member 1,2 and 3 c) Total cartel output.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter10: Monopolistic Competition And Oligoply
Section: Chapter Questions
Problem 13SQ
Related questions
Question
Producers in three countries have formed a cartel to sell a highly-priced product. Suppose the world
P=80-0.005QT
NB: QT is the total cartel sales.
The producers have managed to maximise profit at a price of R70 per unit. Suppose the members have the following total cost functions;
Member 1: TC=7382 + 10Q + 0.05Q2
Member 2: TC= 9374 + 20Q + 0.02Q2
Member 3: TC=7432 + 30Q + 0.03Q2
: Derive:
a) Marginal revenue
b) Output of member 1,2 and 3
c) Total cartel output.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you