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Set up the firm profit maximization problem

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Reference no: EM132460833

Problem: Consider a two-product firm under monopoly. The demand functions are given by

Q1 = 50 - 2p1 + p2 

Q2 = 30 + P1 - 3P2

The firm's cost function is assumed to be C = Q21 +q1q2 +Q22

(a) Set up the firm's profit maximization problem and derive the FOC

(b) Find the optimal Q1 and Q2. Can you find the firm's supply function for each product? Explain.

(C) Check the SOC

Reference no: EM132460833

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