a - If a firm's demand function is given, such as, Q = a CP, where Q is the quantity demanded and P is the price, to find the profit maximizing output - price of the firm, do we always have to take the inverse demand function to find MR orbcan we directly use the demand curve? Kindly provide example for both case scenario to explain the answer.
a - If a firm's demand function is given, such as, Q = a CP, where Q is the quantity demanded and P is the price, to find the profit maximizing output - price of the firm, do we always have to take the inverse demand function to find MR orbcan we directly use the demand curve? Kindly provide example for both case scenario to explain the answer.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:a -
If a firm's demand function is given, such as, Q = a
CP, where Q is the quantity demanded and P is the
price, to find the profit maximizing output - price of the
firm, do we always have to take the inverse demand
function to find MR orbcan we directly use the demand
curve? Kindly provide example for both case scenario to
explain the answer.
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