3. Suppose that for a product in a competitive market the demand function is pfunction is p = 200 + 2x, where x is the number of units and p is in dollars. A firm's average cost function for thisproduct is C(x) == 1200 – 2x and the supply12000+ 50 + x. Find the maximụm profit. Sketch the graphs of the revenue, cost and profitfunctions on the same set of coordinate axes.(Hint: First find the equilibrium quantity and equilibrium price by equalizing the functions of supply and demand.)[P(x) = R(x) – C(x) = p· x – C(x) · x, where pequilibrium price.]

Given Demand function p = 1200-2x ....... (1) and supply function p = 200+2x…

3. Suppose that for a product in a competitive market the demand function is p = 1200 – 2x and the supply function is p = 200 + 2x, where x is the number of units and p is in dollars. A firm's average cost function for this 12000 product is Č(x) + 50 + x. Find the maximum profit. Sketch the graphs of the revenue, cost and profit functions on the same set of coordinate axes. (Hint: First find the equilibrium quantity and equilibrium price by equalizing the functions of supply and demand.) [P(x) = R(x) – C(x) = p · x – Č(x)•x,where p = %3D equilibrium price.]

3. Suppose that for a product in a competitive market the demand function is p = 1200 – 2x and the supply function is p = 200 + 2x, where x is the number of units and p is in dollars. A firm's average cost function for this 12000 product is Č(x) + 50 + x. Find the maximum profit. Sketch the graphs of the revenue, cost and profit functions on the same set of coordinate axes. (Hint: First find the equilibrium quantity and equilibrium price by equalizing the functions of supply and demand.) [P(x) = R(x) – C(x) = p · x – Č(x)•x,where p = %3D equilibrium price.]

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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