Solved Assignments [Requires calculus] In Figure 8-3 the demand facing your firm is Q = 12 – P, and total cost is C…


This Assignment has been Solved

[Requires calculus] In Figure 8-3 the demand facing your firm is Q = 12 − P, and total cost is C = 4Q. Q is your annual output, and P is its price. Show that your profit-maximizing output is 4 units, priced at $8 each, and that your economic profit is $16. a. Now assume that raising marginal cost to $5 raises the demand curve by $2 at all outputs. Show that you now maximize profits by producing 4.5 units, which you sell at $9.50 each. What is the largest increase in marginal cost you will tolerate to shift the demand curve upward by $2? Explain in commonsense terms why it is less than $2. b. Start again from the original demand and marginal cost, and assume that you can invest in advertising to inform buyers about a new use for your product. With probability 0.5 it raises the demand curve by $4 at all outputs, and with probability 0.5 it has no effect. Before considering the campaign’s cost, by how much per year does expected profit increase if you undertake it? Figure 8-3

For over 13 years, we have offered unmatched academic services to students. While at it, we have developed a culture that allows us to keep our clients first. Also, the experience and skillset acquired over the years have refined us and consequently, led to the delivery of the best Academic products. Your Success is our Pride.

How we have managed to stay on Top :

1. Our Qualified Writers and Tutors: Our success is mainly because of our writers and tutors who endeavor to see that all papers are done excellently.

2. Papers of Top Quality: We guarantee top quality papers by employing unique research methods.

3. 100% Product Originality: Originality is the core pillar of our business. We use software and human intellect to check for originality and errors.

4. Timely Delivery: We commit to delivering all assignments within the stipulated timeframe. As such, resources are committed to an assignment depending on the delivery schedule.

5. Pricing: Our price ranges are custom developed to cater for all students. Additionally, we have amazing Discounts.

6. 24/7 Customer Care: We are available through-out to answer and serve our clients.

(it’s simple and quick)


Leave a Comment

Your email address will not be published.