As the manager of your firm, you wish to determine how many widgets to manufacture, such...

Transcribed Image Text:

As the manager of your firm, you wish to determine how many widgets to manufacture, such that profit is maximized. Your chief economist estimates that the fixed costs of operating your manufacturing facility total $200, whereas variable costs come to $5q2, where q indicates the total number of widgets produced. The competitively determined price per widget is $100. A. What is total revenue, expressed in terms of q? B. What is total cost, expressed in terms of q? C. What is marginal revenue? D. What is marginal cost? E. How many widgets should your company produce; i.e., what value for q maximizes total profit? How can you be sure that this is the profit-maximizing, and not profit-minimizing value for q? As the manager of your firm, you wish to determine how many widgets to manufacture, such that profit is maximized. Your chief economist estimates that the fixed costs of operating your manufacturing facility total $200, whereas variable costs come to $5q2, where q indicates the total number of widgets produced. The competitively determined price per widget is $100. A. What is total revenue, expressed in terms of q? B. What is total cost, expressed in terms of q? C. What is marginal revenue? D. What is marginal cost? E. How many widgets should your company produce; i.e., what value for q maximizes total profit? How can you be sure that this is the profit-maximizing, and not profit-minimizing value for q?

Answer rating: 100% (QA)

Lets break down the questions step by step A Total Revenue TR Total Revenue is the product of the qu... View the full answer