The demand function is Q = 100 .5P. The cost function is TC = C =
Question:
a. Find MR and MC.
b. Demonstrate that profit is maximized at the quantity where MR = MC.
c. Derive the relationship between marginal revenue and the price elasticity of demand, and show that the profit-maximizing price and quantity will never be the unit-elastic point on the demand curve.
d. Using the information in part b, demonstrate that the profit-maximizing price and quantity will never be in the inelastic portion of the demand curve.
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 66% (12 reviews)
a MR50 1Q MC 60 2Q b Set MRMC and solve for Q Q24 c MR PQ dP dQ Elasticity is t...View the full answer
Answered By
Akshay Agarwal
I am a Post-Graduate with a specialization in Finance. I have been working in the Consulting industry for the past 8 years with a focus on the Corporate and Investment Banking domain. Additionally, I have been involved in supporting student across the globe in their academic assignments and always strive to provide high quality support in a timely manner. My notable achievements in the academic field includes serving more than 10,000 clients across geographies on various courses including Accountancy, Finance, Management among other subjects. I always strive to serve my clients in the best possible way ensuring high quality and well explained solutions, which ensures high grades for the students along-with ensuring complete understanding of the subject matter for them. Further, I also believe in making myself available to the students for any follow-ups and ensures complete support and cooperation throughout the project cycle. My passion in the academic field coupled with my educational qualification and industry experience has proved to be instrumental in my success and has helped me stand out of the rest. Looking forward to have a fruitful experience and a cordial working relationship.
5.00+
179+ Reviews
294+ Question Solved
Related Book For
Question Posted:
Students also viewed these Economics questions
-
The market demand function is Q = 1,000 1,000p. Each firm has a marginal cost of m = 0.28 (28 per unit). Firm 1, the leader, acts before Firm 2, the follower. Solve for the Stackelberg equilibrium...
-
The Schmidt Corporation estimates that its demand function is Q = 400 - 3P + 4I + 0.6A where Q is the quantity demanded per month, P is the product's price (in dollars), I is per capita disposable...
-
The demand function is Q = 600 - P, with P being the price paid by consumers. Put a list of prices ranging from $400 to $0 in a column labeled P. (Use intervals of $50.) a. Consumers have insurance...
-
Ms. Calhoun is age 51 and single. What is the maximum contribution that she can make to a Roth IRA if: a. Her AGI consists of an $89,400 salary from her employer? b. Her AGI consists of an $89,400...
-
Do male and female students study the same amount per week? In 2007, 58 sophomore business students were surveyed at a large university that has more than 1,000 sophomore business students each year....
-
In using the bolt cutter shown, a worker applies two 300-N forces to the handles. Determine the magnitude of the forces exerted by the cutter on the bolt. 300 N 12 mm 24 mm E 24 mm 460 mm 96 mm 300 N...
-
A gutter running along the side of a house is 6 in. wide and \(40 \mathrm{ft}\) long. During a hard downpour, water is \(1 \mathrm{in}\). deep in the gutter. The gutter has only one downspout, and it...
-
The following feed mixture is to be separated by ordinary distillation at 120 psia so as to obtain 92.5 mol% of the nC4 in the liquid distillate and 82.0 mol% of the iC5 in the bottoms. (a) Estimate...
-
Conduct an A-B-C analysis of the child's behavior. ABC Data Collection Time Antecedent Behavior Consequence How many instances of the problem behavior (tantrums) did you observe? What were...
-
Start with an initial string of zeros. Choose any digit of the string to flip. When a digit is flipped, its value and all those to the right switch state between 0 and 1. Given a target string of...
-
Draw a perfectly elastic demand curve on top of a standard U-shaped average total cost curve. Now add in the marginal cost and marginal revenue curves. Find the profit maximizing point, MR=MC....
-
Explain the competitive process when a firm earns a positive economic profit.
-
What are foreign exchange rates?
-
Which of the two assumptions: uniform pressure and uniform wear would you like to use in designing friction clutch? Explain the reasons.
-
Describe the historical trend from non-enforceability to enforceability of premarital agreements. In this context, indicate the significance of the Posner case.
-
Define the following mechanical properties: ( i) Strength, (ii) Hardness, (iii) Ductility, and (iv) Toughness.
-
Identify the primary purposes of an initial client interview.
-
Define the following terms: (i) Toughness, (ii) Hardness, (iii) Normalizing, and (iv) Case hardening.
-
Ammonia can react with oxygen gas to form nitrogen dioxide and water. (a) Write a balanced chemical equation for this reaction. (b) Use tabulated data to determine the free energy change for the...
-
on 8 For the following set of lengths 130, 170, 160, 160, 150, 190 Third quartile is: et red d out of Select one: O a. 160 a question O b. 145 O c. 175 O d. 180
-
Sondre Glimsdal wants to estimate \(\pi\), the proportion of \(G o^{1}\) games won by white. His prior is \(\pi \sim \beta_{(7,7)}\). Sondre updates his estimate by observing new games. Find the \(80...
-
In the final round of a TV game show, contestants have a chance to increase their current winnings of 1 million dollars to 10 million dollars. If they are wrong, their prize is decreased to $100,000....
-
1. Six bidders in an oral auction place the following values on a good: ($6, $5, $4, $3, $2, $1). In an oral competitive auction, what is the winning price? a. $3 b. $4 c. $5 d. $6 2. Suppose that...
-
Maritime Insurance Company offers insurance policies for recreational boats. A typical policy will pay the replacement cost of $25,000 if the boat is a total loss. If the boat is not a total loss but...
-
1 . What were the problems faced by Income in this case? How were the problems resolved by the new digital system? 2 . What types of information systems and business processes were used by Income...
-
A distant cousin of yours had inherited some money so he was able to realise his life long ambition to set up in business and sell that well known financial publication, the National Review. He put R...
-
Is Mr . Nikhil, a non - resident, liable to pay taxes in India for the financial year 2 0 2 2 - 2 3 based onthe following transactions: ( a ) He received Rs 2 0 lakhs for the use of a patent for a...
Study smarter with the SolutionInn App