Question: Suppose we have the following expressions for the demand function, marginal revenue (MR), total cost (TC) and marginal cost (MC) where P is price and

Suppose we have the following expressions for the demand function, marginal revenue (MR), total cost (TC) and marginal cost (MC) where P is price and Q is quantity: Demand: P = 2600 -20Q or Q=130 -0.05P Marginal Revenue: I MR = 2600 - 40Q Total Cost: TC = 80 + 1000Q + 20Q2 Marginal Cost: MC = 1000 + 40Q a. Find the quantity that will maximize total revenue. What is the value of total revenue at that quantity? b. At what quantity will average cost be minimized? What is the value of average cost at that quantity? (Hint: AC = TC/Q and you will need to create that function and do a bit of simple algebra)

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