Question: The following demand and marginal cost equations represent the demand for some service inside the firm. What price should the service be sold at? Would
The following demand and marginal cost equations represent the demand for some service inside the firm. What price should the service be sold at? Would it matter whether there was an external market for this service?
The demand function
P = 30 – 2Q
The marginal cost function: MC = 20.
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