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Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by C = 200 + 2q2, where q is the level of output and C is total cost. (The marginal cost of production, MC(q), is 4q; the fixed cost, FC, is $200). If the price of a watch is $120, how many watches should you produce to maximize profits? You should produce 30 watches. (Enter your response as an integer.) What will the profit level be? Profit will be $ (Enter your response rounded to two decimal places.) 1

Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by C = 200 + 2q2, where q is the level of output and C is total cost. (The marginal cost of production, MC(q), is 4q; the fixed cost, FC, is $200). If the price of a watch is $120, how many watches should you produce to maximize profits? You should produce 30 watches. (Enter your response as an integer.) What will the profit level be? Profit will be $ (Enter your response rounded to two decimal places.) 1

Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter5: Investment Decisions: Look Ahead And Reason Back
Section: Chapter Questions
Problem 5.6IP
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Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by C = 200 + 2q2, where q is the level of output and C is total cost. (The marginal cost of production, MC(q), is 4q; the fixed cost, FC, is $200). If the price of a watch is $120, how many watches should you produce to maximize profits? You should produce 30 watches. (Enter your response as an integer.) What will the profit level be? Profit will be $ (Enter your response rounded to two decimal places.) 1
Transcribed Image Text:Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by C = 200 + 2q2, where q is the level of output and C is total cost. (The marginal cost of production, MC(q), is 4q; the fixed cost, FC, is $200). If the price of a watch is $120, how many watches should you produce to maximize profits? You should produce 30 watches. (Enter your response as an integer.) What will the profit level be? Profit will be $ (Enter your response rounded to two decimal places.) 1
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