A price-taking firm's variable cost function is C = Q3, where Q is the output per...
A price-taking firm's variable cost function is C = Q3, where Q is the output per week. It has an avoidable fixed cost of $1,024 per week. Its marginal cost is MC = 3Q2. What is the profit maximizing output if the price is P = $192?
Homework Answers
Answer
The firm maximizes profit at MC=P
3Q^2=192
Q^2=64
Q=8
The profit-maximizing output if the price is P = $192 is 8 units
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A price-taking firm's variable cost function is C =
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