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Write out the equation for net benefits

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Suppose that the total benefit and total cost from a continuous activity are, respectively, given by the following equations: B(Q) = 100 + 36Q - 4Q2 and C(Q) = 80 + 12Q. Note that MB(Q) = 36-8Q and MC(Q) = 12.

a. Write out the equation for net benefits.

b. What are the net benefits when Q = 1? Q = 5?

c. Write out the equation for marginal net benefits.

d. What are the marginal net benefits when Q = 1? Q = 5?

e. What level of Q maximizes net benefits?

f. At the value of Q that maximizes net benefits, what is the value of marginal net benefits?

Reference no: EM132228603

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