Equation for the monopolist''s marginal revenue funtion

Reference no: EM13183824

A monopolist's inverse demand function is P = 150 - 3Q. The company produces output at two facilities; the marginal cost of producing at facility 1 is MC1(Q1) = 6Q1, and the marginal cost of producing at facility 2 is MC2(Q2) = 2Q2.

a. Provide the equation for the monopolist's marginal revenue function. (Hint: Recall that Q1 + Q2 = Q.)

MR(Q) = - Q1 - Q2

b. Determine the profit-maximizing level of output for each facility.

Output for facility 1:
Output for facility 2:

c. Determine the profit-maximizing price.

Reference no: EM13183824

Questions Cloud

Compute the amount depreciated at the end of year : The company tresurer must determine the best depreciation method for office furniture that costs $50,000 and has a zero salvage value at the end of a 10-year depreciable life. Compute the amount depreciated at the end of year 5 using the MACRS me..

Who has comparative advantage in each product : Suppose US and Russia produce only two goods meat and potatoes in a week's time according to the table below which shows their production possibilities. Meats(lbs) Potatoes (lbs) Who has absolute advantage in each product? Who has comparative..

What are the firms short-run profits : A firm sells its product in a perfectly competitive market where other firms charge a price of $90 per unit. The firm's total costs are C(Q) = 50 + 10Q + 2Q2. a. How much output should the firm produce in the short run? b. What price should the fir..

What are the appropriate fiscal policies for economy : Suppose equilibrium GDP is less than full-employment output and the economy is in a recession. What are the appropriate fiscal policies that would take the economy to full employment level?

Equation for the monopolist''s marginal revenue funtion : A monopolist's inverse demand function is P = 150 - 3Q. The company produces output at two facilities; the marginal cost of producing at facility 1 is MC1(Q1) = 6Q1, and the marginal cost of producing at facility 2 is MC2(Q2) = 2Q2. Provide the eq..

Determine the profit-maximizing amounts of electricity : Q1 kilowatts are produced at facility 1, and Q2 kilowatts are produced at facility 2 (so Q = Q1 + Q2). The costs of producing electricity at each facility are given by C1(Q1) = 8,000 + 6Q12and C2(Q2) = 6,000 + 3Q22, respectively. Determine the pro..

Find the present worth of the investment : Current machines have a 5 year life and were purchased 3 years ago at $1500000 - Invest $1 Million in upgrade costs to extend the life of the machines for another 5 years - Savings in labor resulting from upgrade, $300000 per year in 1st year doll..

Can govt make things worse by intervening in market : Can the government make things worse by intervening in markets? Are there other options outside the markets and government that will fix macroeconomic failure? C- "Big government is always harmful to owners of private enterprises, w..

Explore how three leadership groups each in their own way : Explain what the various limitations are to a successful fiscal stimulus. Be sure to consider the damaging activities and decisions of (a) private corporations, (b) commercial banks, and (c) wealthy individuals. Explore how these three leadership ..

User Account

All Pages