Solved Assignments [Requires calculus] Referring to Figure 8-5, show that if you cut marginal cost from $4.00 to…


This Assignment has been Solved

[Requires calculus] Referring to Figure 8-5, show that if you cut marginal cost from $4.00 to $2.00 you will raise output from 4 to 5 units and cut price from $8.00 to $7.00. Then show that you will pay up to $9.00 per year to invest in a lower-cost plant that lasts forever.a. Earlier you showed that if the original demand shifts upward by $2, and marginal cost remains , optimal output is 5 units and price is $9. Can you show algebraically that an upward demand shift of X dollars changes profit by the same amount as a downward marginal cost shift of X, assuming linear demand and constant marginal cost? b. Why do you expect that if marginal cost is upward-sloping your previous result will no longer hold? Or will it? Explain. c. If you face a relatively elastic demand, are your gains from a cost-reduction strategy greater or smaller than if demand is relatively inelastic? Explain in commonsense terms.

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Your email address will not be published.