Suppose that the manager of a firm operating in a competitive market has estimated the firm's average variable costs function to be AVC = 10 – 0.03q + 0.00005q² TC = 600 + 10q – 0.03q² + 0.00005q³ - The MC curve in this setting is MC = 10 – 0.06q + 0.00015q² Suppose the market price for output is $10 per unit. What is the profit maximizing level of output? (Start q at 0, but increase it by 50 each step. Get q at least past 600. Also, be sure to pass though every step of the maximization flow chart to answer all questions.) What is the profit per unit of output? What is the total profit of this firm?

Suppose that the manager of a firm operating in a competitive market has estimated the firm's average variable costs function to be AVC = 10 – 0.03q + 0.00005q² TC = 600 + 10q – 0.03q² + 0.00005q³ - The MC curve in this setting is MC = 10 – 0.06q + 0.00015q² Suppose the market price for output is $10 per unit. What is the profit maximizing level of output? (Start q at 0, but increase it by 50 each step. Get q at least past 600. Also, be sure to pass though every step of the maximization flow chart to answer all questions.) What is the profit per unit of output? What is the total profit of this firm?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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2.2
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