Dalahla Company Limited, focusing on producing tooth paste (n units) has a demand function 4Q = 35 – 0.5P. If total fixed cost is GH¢80 and average variable cost per unit function is 3Q – 51 + e, where Q is number of tooth paste produced and P is the price per tooth paste (in GH¢). What is the total profit at the profit maximizing level of output, and what is the best pricing policy option? 320

Dalahla Company Limited, focusing on producing tooth paste (n units) has a demand function 4Q = 35 – 0.5P. If total fixed cost is GH¢80 and average variable cost per unit function is 3Q – 51 + e, where Q is number of tooth paste produced and P is the price per tooth paste (in GH¢). What is the total profit at the profit maximizing level of output, and what is the best pricing policy option? 320

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

Cindy's demand function for her legal services is given by the equation Q = 5000 - 20P, where Q represents the number of 1-hour sessions per year and P represents the price of each session. Her marginal revenue function is MR = 250 - 0.01Q. Cindys operation has no fixed costs, but she incurs a cost of $500 per session ( going to the clients house). What is Cindys yearly profit?
A fried chicken franchise finds that the demand equation for its new roast chicken product, "Roasted Rooster," is given by 40 p0.6 where p is the price (in dollars) per quarter-chicken serving and q is the number of quarter-chicken servings that can be sold per hour at this price. Find E(p) E(p) = q= X Find the price elasticity of demand when the price is set at $3.70 per serving. At a price of $3.70, a 1% increase in price leads to a Interpret the result. At a price of $3.70, the demand is elastic They should raise X% decrease in demand. ✓X the price per serving in order to increase revenue.
Suppose Ring Dental is the single supplier at HRM region provide the dental service and has a market demand curve Q = 40 – P; A total cost curve given by the formula: T C = 80 - 20Q + 2Q2 Find the profit-maximizing quantity, price, and profit. Now, suppose Halifax Dental wishes to separate the market and target to two different groups of customers young and old customers, the average cost = marginal cost = 10 for both markets Young customers with elasticity = -5 and DA = 12000 - 65P Old customers with elasticity = -7 and DB = 12000 - 55P What is the profit if Halifax Dental sets the equal price for both markets? (use the average elasticity for equal price) What is the profit if Halifax Dental charges different prices for each market?
Ecotripper Enterprises is the sole producer of Sunblast solar-powered skateboards, “The green alternative”. Market demand for Sunblasts is given by the formula: P=120-0.5Q, where p is in $ per skateboard and Q in skateboards per week. Total costs, in $ per week, are given by: TC=100+20Q, and marginal cost (MC) equal 20. a.) Derive the marginal revenue function and calculate the profit-maximizing price, quantity sold and the profit. b.) If the government imposes a price ceiling of $ 65 per skateboard, what is the effect on the equilibrium and the values derived in a.)? c.) If the government wanted Ecotripper to produce the socially efficient quantity of skateboards, what price ceiling could it set in the short run? What would the result be in the long run? d.) If the government decided to set the price ceiling so that consumer surplus was maximized subject to Ecotripper earning zero profits, what would be the level of the price ceiling, the quantity sold and the consumer surplus?
The Poster Bed Company believes that its industry can best be classified as monopolistically competitive. An analysis of the demand for its canopy bed has resulted in the following estimated demand function for the bed: P = 1,265-9Q The cost analysis department has estimated the total cost function for the poster bed as TC = -15Q3 +5Q +24,000 Short-run profits are maximized when the level of output is The total profit at this price-output level is The point price elasticity of demand at the profit-maximizing level of output is The level of fixed costs the firm is experiencing on its bed production is What is the impact of a $5,000 increase in the level of fixed costs on the price charged, output produced, and profit generated? Price Charged Output Produced Profits Generated Increase No change Decrease O O and the price is $ O O
Seafood Salt Company wishes to set the same price in two markets A and B. The firm’s total cost schedule is TC = 300 + $4*QA + $4*QB. Demands in the two markets are QA = 120-10*PA and QB = 120 – 12*PB. If the firm does not price discriminate, the profit-maximizing price to charge in both markets is
Use the orange points (square symbol) to plot the initial short-run industry supply curve when there are 10 firms in the market. (Hint: You can disregard the portion of the supply curve that corresponds to prices where there is no output since this is the industry supply curve.) Next, use the purple points (diamond symbol) to plot the short-run industry supply curve when there are 15 firms. Finally, use the green points (triangle symbol) to plot the short-run industry supply curve when there are 20 firms. PRICE (Dollars per pound) 100 90 80 70 80 50 40 30 20 10 0 0 125 250 375 500 825 750 875 1000 1125 1250 QUANTITY (Thousands of pounds) Demand Because you know that competitive firms earn Supply (10 firms) True Supply (15 firms) If there were 10 firms in this market, the short-run equilibrium price of rhodium would be $ would . Therefore, in the long run, firms would False Supply (20 firms) per pound. From the graph, you can see that this means there will be ? per pound. At that price,…
i need in words not handwritten solution please
Read- https://www.practicalecommerce.com/optimize-dtc-profits-with-price-elasticity-analysis -and- https://www.practicalecommerce.com/the-full-cost-of-a-direct-to-consumer-product Question: Discuss how the concepts of price elasticity of demand and production costs help firms set their selling prices.
The market demand, submarket demands (submarket 1 (Qd1); submarket 2 (Qd2)), and total cost functions are below: Qd= 50- 0.5P Qdj=32 - 0.4P1 Qd2=18-0.1P2 TC=50+40Q What is the profit-maximizing price of submarket 1 (P1?) under the third-degree price discrimination? Yanıt:
At these levels of output the marginal revenue in the manufactured items market is and the marginal revenue in the semimanufactured raw materials market is . At these prices, the price elasticity of demand in the manufactured items market is and the the price elasticity of demand in the semimanufactured raw materials market is . (Hint: ED=PMR−P��=�MR−�) What are the total profits if the company is effectively able to charge different prices in the two markets? . If the company is required by law to charge the same per-ton rate to all users, the new profit-maximizing level of price and output are per ton and tons respectively. The total profits in this situation is .
Please answer the blank questions