Question

Q6 (9 pts). The demand function of the market isgiven by: Po 50- 1.25Q, with a fixed cost of $ 160 and a unit variable cost of $10 The revenue function is: TR(Q)-- The cost function is: TC(Q (I) Calculate: Hint: The correct profit function is one of the options below (This is just to provide you a hint you need to show all your work in order to obtain all the points) a) π(Q)--1.250° + 50Q-160 b) π(Q)--1.250° + 40Q-160 c) (Q)1250 400-170 d) π(Q)-2.5Q2-400+ 160 (II) The two breakeven points are when Q # and Choose the correct answer (Showing the appropriate steps) a) Q-3.50 and 36.49 b) Q 4.69 and 36.49 c) Q = 4.69 and 27.31 d) Q=3.50 and 27.31 (III) The quantity produced is ___ in order to obtain the highest profit which is $ Choose the correct answer (Showing the appropriate steps) a) Q-4, profit 160 c) Q-16, profit 120 b) Q-16, profit 160 d) Q-5, profit-25

Answer 1