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A firm sells its product in a perfectly competitive market where other firms charge a price of $120 per unit. The firm’s total costs are C(Q) = 50 + 12Q + 2Q2.
A. How much output should the firm produce in the short run?
B. What price should the firm charge in the short run?
C. What are the firm’s short-run profits?
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You are the manager of a firm that receives revenues of $60,000 per year from product X and $90,000 per year from product Y. The own price elasticity of demand for product X is -1, and the cross-price elasticity of demand between product Y and X is 1..
Illustrate what was the marginal cost of the 251st unit of output.
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