XL Corp has estimated its demand and cost functions to be as follows:P = 60 - 0.2QC2004Q+ 1.2(Q)^2where Q is in units, P is in $ and C is in $.a. Calculate the profit - maximizing price and output.b. Calculate the size of the profit.c. Calculate the price elasticity of demand at the above price.d. If there is a $14 tax placed on the good, so that the producer has to pay the government $14 for everyunit sold, calculate the new profit maximizing price and output.e. What would happen to profit if the firm tried to pass on all the tax to the consumer in the form of ahigher price?f. If fixed costs rise by $200 how would this affect the firm's situation?

Answered: XL Corp has estimated its demand and…

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

PQR Ltd operates in a perfectly competitive market. The following equations were developed for the company to assist in its analysis of demand and supply conditions in the market. Qd= 610-50p Qs= 400- 20p Where Qd is quantity demanded; Qs is quantity supplied; and p is price Required: (e) Calculate the price at which there is a shortage of 50 units. (f) Calculate the price at which there is a surplus of 40 units.
1. A company has estimated that its total cost (TC) function is: TC = 12,000 + 60Q Where Q refers to quantity. The marketing department of this company is unable to estimate the demand function for the company but believes the price elasticity for the company's products is (-)4. Given this information, calculate the profit maximising price
Netflix is increasing its streaming service from $9.99 per month to $10.99 per month. Which is must be true? a) They will lose less than 5% of subscribers b) They will not lose any subs c) They will lose no more than 20% of their subs d) They will lose less than 10% of their subs
The demand curve for product a is given as Q = 2000 - 20P. a. How many units will be sold at $10? b. At what price would 2,000 units be sold? 0 units? 1,500? c. Write equations for total revenue and marginal revenue (in terms of Q). d. What will be the total revenue at a price of $70? What will be the marginal revenue? e. What is the point elasticity at a price of $70? f. If price were to decrease to $60, what would total revenue, marginal revenue, and point elasticity be now? g. At what price would elasticity be unitary?
If the total revenue function of a good is given by TR= 900Q- 3Q² Find Marginal Revenue at Q=20 Estimate the change in the value of TR due to a 2 unit increase in Q.
devrat
If the price is given as 20 per unit and the given quantity is $150 billion Find the Total revenue
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 .
E.g.1: A demand function is given by the equation P = 24 6lnQ ➤ Find the equation of TR (total revenue) and determine for which value of Q is TR maximised. Find MR (marginal revenue) as a function of Q Show that MR is a positive decreasing, concave up function.
Question 6. PDO company specializes in rapid parcel delivery. Cross sectional data from PDQ's regional "hubs" were used to estimate the demand equation for the company's services. Holding income and prices of other goods constant, the demand equation is estimated to be P 66Q 1A where p is the price per pound and Q is pounds delivered. The marginal cost of delivery is constant and equal to Le 2 per pound. a. What is the point price elasticity of demand? b. What are the profit maximizing price and quantity? c. What are the total revenue maximizing price and quantity? d. For each of the the given equations F(y,x) =0 is an implicit function y f(x) defined around the point (y 3, x 1 (i) X³-2x'y +3xy?-2ii 2x2 +4xy -y+ 67 0 If the answer is on the affirmative find by the implicit function rule and evaluate at the said pt. dx
My student id is 2020-3-60-007 and (Departmental code - 101) (a) Plot Demand, Marginal Cost, Marginal Revenue and Average Total Cost curve inone graph. Identify the Profit maximizing level of price and quantity in the graph.(b) Calculate the Profit from the above graph given the following data:• Profit maximizing Price level is the first 4 digits of your EWU Student ID• Profit maximizing Cost level is the last 3 digits of your EWU Student ID• Profit maximizing Output level is the 2 digits (departmental code) from yourEWU Student ID
Managerial Econ - Required Homework for Module 1 Problem 1: A company's revenue function can be defined as; TR = Price (P) × Quantity Demanded (Q). If the ordinary demand function for your firm is Q = 75 -0.4P where Q is monthly output: a. What is the total revenue function for this firm in terms of Q? b. What is the average revenue function for this firm in terms of Q? C. What is the MR function for this firm in terms of Q? d. Show that MR will be less than AR for any positive level of Q. Why is that? e. What is the quantity level that maximizes total revenue? What is the price? Problem 2: Your company's cost function (monthly) can be defined as; TC: cost per unit (AC) × quantity supplied (Q). If the cost per unit (average cost) for your firm is AC = (800/Q) – 10 +2Q: a. What is the total cost function for your firm in terms of Q? b. How would you interpret the intercept term in this function? c. What is the marginal cost function for your firm? d. At what level of output (Q) is AC…

SEE MORE QUESTIONS

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS