Question: Average Cost-Minimization. Pharmed Caplets is an antibiotic product with monthly revenues and costs of: TR = $900Q - $0.1Q2 TC = $36,000 + $200Q +

Average Cost-Minimization. Pharmed Caplets is an antibiotic product with monthly revenues and costs of:

TR = $900Q - $0.1Q2 TC = $36,000 + $200Q + $0.4Q2

MR = TR/Q = $900 - $0.2Q MC = TC/Q = $200 + $0.8Q

C. Determine these profit-maximizing and average-cost minimizing price/output combinations analytically. In other words, use revenue and cost equations to confirm your answers to part B.

D. Compare the profit-maximizing and average-cost minimizing price/output combinations, and discuss any differences. When will average-cost minimization lead to long-run profit maximization

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