A company produces a certain good for which the (inverse) demand function is given by p = 15 - 2q, where p is the unit price (expressed in some monetary unit) and q is the quantity sold (expressed in some non-specified unit). The fixed costs amount to 6.5 monetary units and the variable costs amount to 1 monetary unit per non-specified unit of the good. We assume that all goods produced are sold. a. Find the function equation for the profit functionP in terms of the quantity q. b. Find the domain of the profit function P. c. Determine for which production levels q the company makes a profit.

A company produces a certain good for which the (inverse) demand function is given by p = 15 - 2q, where p is the unit price (expressed in some monetary unit) and q is the quantity sold (expressed in some non-specified unit). The fixed costs amount to 6.5 monetary units and the variable costs amount to 1 monetary unit per non-specified unit of the good. We assume that all goods produced are sold. a. Find the function equation for the profit functionP in terms of the quantity q. b. Find the domain of the profit function P. c. Determine for which production levels q the company makes a profit.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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