Reference no: EM133133618
Pharmed Caplets is an antibiotic product with monthly revenues and costs of:
TR = 900Q - 0.1Q2
TC = 36,000 + 200Q + 0.4Q2
(a) Set up a spreadsheet (table) for output (Q), price (P), total revenue (TR), marginal revenue (MR), total cost (TC), marginal cost (MC), average cost (AC), total profit (π), and marginal profit (Mπ). Establish a range for Q from 0 to 1,000 in increments of 100 (i.e., 0, 100, 200, ..., 1,000).
(b) Based on your spreadsheet answer in part (a), at what price/output combination is total profit maximized? Why?
(c) Based on your spreadsheet answer in part (a), at what price/output combination is average cost minimized? Why?
(d) At what price/output combination is total revenue maximized? Why?