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You are given the following data for your firm, which sells the only commercially-available Bluetooth-enabled paper towel dispenser.
Q P TC
0 $60.00 $1,000.00
10 $56.50 $1,032.00
20 $53.00 $1,064.00
30 $49.50 $1,108.00
40 $46.00 $1,176.00
50 $42.50 $1,280.00
60 $39.00 $1,432.00
70 $35.50 $1,644.00
80 $32.00 $1,928.00
90 $28.50 $2,296.00
100 $25.00 $2,760.00
a. Determine equations for P=f(Q), MR=f(Q), ATC=f(Q, Q2), AVC=f(Q, Q2), MC=f(Q, Q2). Recall that your marginal equations should be derivatives of your totals!
b. c. (Since MC is in terms of Q2, solving with calculus and algebra can be messy. Your table should give an exact answer.)
c. How much total profit would your firm earn if you set P and Q according to part b?
d. Describe the competitiveness of the market by calculating the Lerner index
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