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2. (40 points) A firm faces the following inverse demand equation for the commodity it produces P = 100 - Q where P represents the price/unit of the commodity it produces and Q represents the level of output produced. The cost structure of this firm is summarized by the following total cost function: C = 1/3 Q^3 - 7Q^2 + 115.75Q + 20 where C represents the total cost of production.

e. Find the benefit (profit) maximizing level of output?

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Joshua Stredder
Joshua StredderLv10
28 Sep 2019

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Related questions

A firm faces the following inverse demand equation for the commodity it produces:

P = 100 - Q

Where P represents the price/unit of the commodity it produces and Q represents the level of output produced.

The cost structure of this firm is summarized by the following total cost function:

C = 1/3 Q3 -7Q2 + 115.75Q + 20

Where C represents the total cost of production.

What is this firm's total benefit (profits) function?

A typical firm in Industry X has the following total cost and marginal cost functions:

TC(q) = q2+210+30q

MC(q) = 2q+30 where q represents the units of output.

a) What is the fixed cost of a typical firm in this industry when it producers 20 units of output.

b) What is the variable cost of a typical firm in this industry when it produces 20 units of output.

c) What is the equation for average total cost (ATC)?

d) What is average total cost when the firm produces 40 units of output?

e) ATC reaches its minimum value at how many units of output?

f) Are there economies of scale at 10 units of output? Explain your reasoning.

A Monopoly firm faces the following demand curve: P=200-0.5Q Where Q is the output and P is the price in dollars. The firm's total cost function is given by TC=20,000 + 40Q

1. What is the level of production?

2. What is the price monopolist should charge?

3. What is the level of profit?

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