[Suppose] A Cmpany is the sole provider of electricity in the various districts of Dubai. To meet the monthly demand for electricity in these districts, which is given by the inverse demand function: P = 1,200 − 4Q, the company has set up two electric generating facilities:Q1 kilowatts are produced at facility 1 andQ2 kilowatts are produced at facility 2; where Q = Q1 + Q2. The costs of producing electricity at each facility are given byC1(Q1) = 8,000 + 6Q1C2(Q2) = 6,000 + 3Q2 + 5Q22 What is the MR function? What is the MC function of each facility?What is the MC function of the firm?

We are going to find the revenue function, marginal revenue function to answer this question. .

Answered: Suppose] A Cmpany is the sole provider…

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

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Chapter1: Making Economics Decisions

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[Suppose] A Cmpany is the sole provider of electricity in the various districts of Dubai. To meet the monthly demand for electricity in these districts, which is given by the inverse demand function: P = 1,200 − 4Q, the company has set up two electric generating facilities:

Q₁ kilowatts are produced at facility 1 and
Q₂ kilowatts are produced at facility 2;

where Q = Q₁ + Q₂.

The costs of producing electricity at each facility are given by

C₁(Q₁) = 8,000 + 6Q₁
C₂(Q₂) = 6,000 + 3Q₂+ 5Q₂²

What is the MR function?
What is the MC function of each facility?
What is the MC function of the firm?

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