Question

Suppose the marginal cost of writing a contract of length L is MC(L) = 10 + 2L. Find the optimal contract length when the marginal benefit of writing a contract is:
a. MB(L) = 100.
b. MB(L) = 150.
c. What happens to the optimal contract length when the marginal benefit of writing a contract increases?



Sales4
Views747
Comments0
  • CreatedNovember 15, 2011
  • Files Included
Post your question
5000