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2. A firm is a perfectly competitive producer and sells good A and good B at RM100 and RM80, respectively. The total cost of producing these goods is given by TC = 2Q% + 2QAQB + Qb, where Qa and QB denote the output level of good A and good B, respectively. i) Find the firm's total profit function. ii) Calculate the values of Qa and QB which maximize profit. iii) Using the second order condition (SOC), prove that the profit level is at a maximum.

2. A firm is a perfectly competitive producer and sells good A and good B at RM100 and RM80, respectively. The total cost of producing these goods is given by TC = 2Q% + 2QAQB + Qb, where Qa and QB denote the output level of good A and good B, respectively. i) Find the firm's total profit function. ii) Calculate the values of Qa and QB which maximize profit. iii) Using the second order condition (SOC), prove that the profit level is at a maximum.

Advanced Engineering Mathematics
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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2. A firm is a perfectly competitive producer and sells good A and good B at RM100 and RM80, respectively. The total cost of producing these goods is given by TC = 2Q% + 2QAQB + Q%, where QA and QB denote the output level of good A and good B, respectively. i) Find the firm's total profit function. ii) Calculate the values of Qa and QB which maximize profit. iii) Using the second order condition (SOC), prove that the profit level is at a maximum.
Transcribed Image Text:2. A firm is a perfectly competitive producer and sells good A and good B at RM100 and RM80, respectively. The total cost of producing these goods is given by TC = 2Q% + 2QAQB + Q%, where QA and QB denote the output level of good A and good B, respectively. i) Find the firm's total profit function. ii) Calculate the values of Qa and QB which maximize profit. iii) Using the second order condition (SOC), prove that the profit level is at a maximum.
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