About the profit maximizing quantity

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Reference no: EM13854756

Mr Jones run a motel in St Pete. The market is highly competitive since there are many motels in the area and average room rate per night is $35. There are 30 rooms in Mr Jones motel and each room can be rented out for 30 nights a month. That is Mr Jones can rent 900 nights in total each month. Mr Jones monthly cost curve is :

TC = 10,000 + 10 x Q

Q is the number of nights he will rent each month.

Since Marginal Cost = $10, what is Mr Jones profit maximizing quantity? What is his max profit?

Reference no: EM13854756

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