1 suppose the demand for baseballs is given by q 200 -

Reference no: EM13379209

1. Suppose the Demand for baseballs is given by Q = 200 - 8P.

a) What is the price elasticity of demand when P = 6?

b) At what price will Total Revenue be maximized?

c) What is the firm's Marginal Revenue when the price is $10?

2. Suppose there are n identical firms in a market. Each firm's cost function is given by C = 240+ 15q2, where q is the amount that an individual firm produces. This means that an individual firm's marginal cost is given by MC = 30q. Also, the market demand is given by P = 504 - 8Q, where Q is the total amount of the good produced by all of the firms combined. Therefore, Q = n*q.

a) How much output will each of them produce?

b) What will be the market price?

c) How many firms will there be in long run equilibrium?

Reference no: EM13379209

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