This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: A monopolist's demand curve is given by: p = 100 + A1/2 Q where Q is the quantity of output and ... (Read 66 times)

joesmith1212

  • Hero Member
  • *****
  • Posts: 549
on: Jul 1, 2018
A monopolist's demand curve is given by:
 
  p = 100 + A1/2  Q
  where Q is the quantity of output and A is the quantity of advertising. Suppose the cost of advertising and output is given by:
   C(Q,A) = 10Q + A
  Determine the profit maximizing quantity of output and advertising.

Question 2

Which of the following cost relationships is not true?
 
  A) AFC = AC - MC
  B) TVC = TC - TFC
  C) The change in TVC/the change in Q = MC
  D) The change in TC/ the change in Q = MC


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

bassamabas

  • Sr. Member
  • ****
  • Posts: 294
Reply #1 on: Jul 1, 2018
Answer to Question 1

The monopolist maximizes profit
Profit = (100 + A1/2  Q)Q  10Q + A
The first order conditions are:
dProfit/dQ = 100  2Q  10 = 0
dProfit/dA = .5A-1/2Q  1 = 0
Solve the first condition to find Q= 45. Use this to solve the second conditions for A = 506.

Answer to Question 2

A


joesmith1212

  • Member
  • Posts: 549
Reply 2 on: Jul 1, 2018
Excellent

Dinolord

  • Member
  • Posts: 313
Reply 3 on: Yesterday
Wow, this really help

« previous next »
 

Did you know?

Anti-aging claims should not ever be believed. There is no supplement, medication, or any other substance that has been proven to slow or stop the aging process.

Did you know?

Increased intake of vitamin D has been shown to reduce fractures up to 25% in older people.

Did you know?

Historic treatments for rheumatoid arthritis have included gold salts, acupuncture, a diet consisting of apples or rhubarb, nutmeg, nettles, bee venom, bracelets made of copper, prayer, rest, tooth extractions, fasting, honey, vitamins, insulin, snow collected on Christmas, magnets, and electric convulsion therapy.

Did you know?

Atropine was named after the Greek goddess Atropos, the oldest and ugliest of the three sisters known as the Fates, who controlled the destiny of men.

Did you know?

Giardia is one of the most common intestinal parasites worldwide, and infects up to 20% of the world population, mostly in poorer countries with inadequate sanitation. Infections are most common in children, though chronic Giardia is more common in adults.

A typical ECT sensor temperature versus voltage curve. A typical ECT sensor temperature versus voltage curve.
The growth in demand for oil in China is driven by the growth in demand for personal transport The growth in demand for oil in China is driven by the growth in demand for personal transport
The demand for oil can be reduced significantly with the introduction of new higher vehicle mileage The demand for oil can be reduced significantly with the introduction of new higher vehicle mileage
An Environmental Kuznets Curve An Environmental Kuznets Curve
The slope of the curve y = ax^3 - bx^2 + cx - 3 at x = 2 is 5. If the point of inflection of the cur The slope of the curve y = ax^3 - bx^2 + cx - 3 at x = 2 is 5. If the point of inflection of the cur
Construct a Lorenz curve that shows income distribution in this society. Construct a Lorenz curve that shows income distribution in this society.
Video: Polysaccharides

For a complete list of videos, visit our video library