Question: The cost function for Acme Laundry is C(q) = 10 + 10q + q 2 , so its marginal cost function is MC = 10

The cost function for Acme Laundry is C(q) = 10 + 10q + q

2

, so its marginal cost function is MC =

10 + 2q, where q is tons of laundry cleaned. Derive the firm's average cost and average variable

cost curves. What q should the firm choose so as to maximize its profit if the market price is p?

How much does it produce if the competitive market price is p = 50?

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