When maximizing profit, how much profit will she make

Reference no: EM131072394

A monopolist with a demand curve given by P = 240-2Q has a cost structure made up of a fixed cost of $500 and a marginal production cost of MC = 40.

(a) When maximizing profit, how much profit will she make?

(b) Suppose now that she can outsource some of her assembly work to a plant in Indonesia, and this reduces her marginal production cost to $32 per unit, but also increases her fixed cost to $750. Should she outsource?

Reference no: EM131072394

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