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A two-product firm faces the following demand and cost functionsL (a) Find the output levels that satisfy the first-order conA two-product firm faces the following demand and cost functionsL
Q
1
= 40 2P
1
P
2
, Q
2
= 35 P
1
P
2
, C = Q
2
1
+ 2Q
2
2
+ 10.
(a) Find the output levels that satisfy the first-order condition for maximum
profit.
(b) Check the second-order sufficient condition. Can you conclude that this
problem possesses a unique absolute maximum?
(c) What is the maximal profit?

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A two-product firm faces the following demand and cost functionsL Q 1 = 40 2P 1 P 2 , Q 2 = 35 P 1 P 2 , C = Q 2 1 + 2Q...
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