### Lemonade Stand Economics1. **Scenario**: You operate a lemonade stand in your neighborhood, requiring 3 lemons (denoted as $L \geq 0$) to produce one glass of lemonade, with a production quantity $Q \geq 0$. Each lemon costs $c_L > 0$ and you sell your lemonade for a price $p_L > 0$. Additionally, due to lack of a permit, you must pay your neighbor Karen a bribe of $F > 0$ to avoid being reported to the authorities. a. **Production Function**: What is the function that describes the relationship between the inputs (lemons) and the output (lemonade)? b. **Profit Function**: What is the equation that determines the profit of the lemonade stand considering costs and revenues? c. **Profit Maximization**: How much lemonade should be sold to achieve maximum profit?### ExplanationIn this scenario, students will explore elements of production and profit optimization. The exercise is designed to help understand concepts such as production functions, cost analysis, and profit maximization within a small business context.

The question asked us to calculate Production function,Profit function and the Profit maximizing…

1. Suppose you own a lemonade stand and sell delicious lemonade in your neighborhood. Ittakes 3 lemons, L2 0, to make a glass of lemonade, Q2 0. Each lemon costs c> 0 and you sell your lemonade for pi > 0. Furthermore, assume that you must pay your neighbor Karen a bribe of F > 0, as you do not have a license to operate the lemonade stand and she will call the police otherwise. a. What is the production function of the lemonade stand? b. What is the profit function of the lemonade stand? c. What is profit maximizing amount of lemonade to sell?

1. Suppose you own a lemonade stand and sell delicious lemonade in your neighborhood. Ittakes 3 lemons, L2 0, to make a glass of lemonade, Q2 0. Each lemon costs c> 0 and you sell your lemonade for pi > 0. Furthermore, assume that you must pay your neighbor Karen a bribe of F > 0, as you do not have a license to operate the lemonade stand and she will call the police otherwise. a. What is the production function of the lemonade stand? b. What is the profit function of the lemonade stand? c. What is profit maximizing amount of lemonade to sell?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

None
3. Assume inverse demand function for game console in an imaginary country is P=1200-4Q and the total cost function is TC=400+4Q². Government put $120 of specific tax on production. a. If the market is competitive what is the incidence of tax on consumer? b. If the market is monopolist what is the incidence of tax on consumer?
Please answer all parts...
2a. Graphic and describe the market for Spam. 2b. Graph and describe what happens in this market when people's incomes fall. (Include this in the graph for 2a).
RAGERIAL ECO X Question 3 Chapter 17 & 19 P X 13.1 Objectives and Methods of X a the more elastic the demand for x + https://ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl... A to 9 ( & 19 Problems Saved Help Save & Exit In an oligopolistic market, Multiple Choice the smaller the number of firms and the more elastic the demand, the greater the markup. the larger the number of firms and the more elastic the demand, the greater the markup. the larger the number of firms and the less elastic the demand, the greater the markup. the smaller the number of firms and the less elastic the demand, the greater the markup. Submit g 53
4. Suppose a manufacturer and its retailer face the problem of double marginalization described in my notes, Section 11.1. If the manufacturer sets the wholesale price equal to its marginal cost c and in addition, requires the retailer to pay a fraction a (between 0 and 1) of its profit. Write down the retailer's profit maximization problem. Will this practice solve the double marginalization problem? (That is, will this 4.a practice maximize their joint profit?) 4.k Suppose the retailer is required to pay a fraction of a of its sales (i.e., total revenue). Write down the retailer's profit maximization problem. Will this practice solve the double marginalization problem?
4
Handwritten asap plzzzzzz...solve 20 mins..i"ll give you more votes
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
2
#7. Your company sells widgets. There is only one other firm in the market: Bear Widgets. Demand for your product depends upon your price, your quantity, and the price that Bear Widgets charges (Pgear). You think that Bear Widgets will either charge $10 or $20. What should you do if their price will be $20? Demand: P = 50 – Q + 0.5P3ear Marginal costs: MC = 2Q %3D a. Produce Q = 20 b. Produce Q = 18.33 c. Produce Q = 16.67 d. Produce Q = 15 %3D e. Produce Q = 13.75