4. (6 points) Consider a competitive firm with cost function given by c(y) = 99+ y...

 

Transcribed Image Text:

4. (6 points) Consider a competitive firm with cost function given by c(y) = 99+ y + ey. The price of the firm's output is p > 0, and the firm's profit function is (y) = y c(y). - (a) (1 point) Compute the fixed cost, FC = c(0). (b) (5 points) Find the formula for the profit-maximizing output level given p, namely y* =y(p). (Remember to check the SOC.) 4. (6 points) Consider a competitive firm with cost function given by c(y) = 99+ y + ey. The price of the firm's output is p > 0, and the firm's profit function is (y) = y c(y). - (a) (1 point) Compute the fixed cost, FC = c(0). (b) (5 points) Find the formula for the profit-maximizing output level given p, namely y* =y(p). (Remember to check the SOC.)