The Backus Corporation makes two products, X and Y. For every unit of good X that the
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TC = 500 + 3Q + 9Q2
where Q is the number of units of output (where each unit contains one unit of good X and two units of good Y) and TC is total cost (in dollars). The demand curves for the firm's two products are
PX = 400 - QX
PY = 300 - 3QY
where PX and QX are the price and output of product X and PY and QY are the price and output of product Y.
a. How much of each product should the Backus Corporation produce and sell per period?
b. What price should it charge for each product?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For
Managerial Economics Theory Applications and Cases
ISBN: 978-0393912777
8th edition
Authors: Bruce Allen, Keith Weigelt, Neil A. Doherty, Edwin Mansfield
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