Question: A Price-taking firm's variable cost function is VC = Q 3 , where Q is its output per week. It has a sunk fixed cost

A Price-taking firm's variable cost function is VC = Q³, where Q is its output per week. It has a sunk fixed cost of $3,000 per week. Its marginal cost is MC = 3Q².

1. What is its profit-maximizing output when the price is P = $243?

2. What if the fixed cost is avoidable?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Explanation Problem 5 A price-taking firm's variable cost function is VC = Q', where Q is its output per week. It has a sunk fixed cost of $3,000 per week. Its marginal cost is MC = 3Q'. What is its...

8. A price-taking firm's variable cost function is C =Q'. where Q is the output per week. It has a sunk fixed cost of $2,000 per week. Its marginal cost is MC = 3Q'. What is the profit maximizing...

A price-taking firm's variable cost function is C = Q 3 , where Q is the output per week. It has an avoidable fixed cost of $1,024 per week. Its marginal cost is MC = 3 Q 2 . What is the profit...

A price-taking firm's variable cost function is where Q is its output per week. It has a sunk fixed cost of $3,000 per week. Its marginal cost is What is its profit-maximizing output when the price...

Give correct answers. Suppose that initially a competitive industry with many identical firms is in the long-run equilibrium. Each firm has a cost function of C0 (q) =1+q2. Discovery of a new...

Managerial Question 1: 10. Suppose that the manager of a firm operating in a competitive market has estimated the firm's average variable cost function to be AVC = 10 - 0.03Q + 0.00005Q2 sitas vilor...

l. [6 points) Suppose in the short run a perfectly competitive firm has variable cost = 3:11, and MC = q where q is the quantity of output produced. Also, the firm has fixed cost F = 243. a) [3...

Harding Silicon Enterprises, Inc. produces less than 1% of the worlds supply of 32 MB random access memory (RAM) chips for electronic devices.HSEs RAM chips perform according to globally accepted...

7. A firm in a perfectly competitive market has a total cost function of TC (Q) = 3 + 3Q + 2Q2, and the market price for its product is $9 per unit. 7.1. (5 points) What is the firm's average fixed...

When AD shifts left, does this cause a movement along the SRPC curve or causes the SRPC to shift? How about SRAS shifts left, does this cause a movement along the SRPC or cause SRPC to shift? Explain...

What is the relationship between the shape of the aggregate supply curve and the effectiveness of monetary policy at changing Real GDP?

Based on the 1 2 3 year history in the Credit Suisse Yearbook, U . S . equities had an annual return of _ _ _ _ in nominal terms. Group of answer choices 6 . 4 % 1 2 . 5 % 1 0 . 6 % 9 . 5 %

Identify for a firm in your industry some aspects of the N=1 and R=G concepts highlighted in this chapter in two to three paragraphs.

Do not go, wait until I come

Pay him, do not wait until I sign

Tell what you mean without sounding too dominant, i.e. show authority without sounding instructive