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 67 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
Gracias!

Viet Thy

  • Member
  • Posts: 329
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

As many as 28% of hospitalized patients requiring mechanical ventilators to help them breathe (for more than 48 hours) will develop ventilator-associated pneumonia. Current therapy involves intravenous antibiotics, but new antibiotics that can be inhaled (and more directly treat the infection) are being developed.

Did you know?

Drug-induced pharmacodynamic effects manifested in older adults include drug-induced renal toxicity, which can be a major factor when these adults are experiencing other kidney problems.

Did you know?

Human kidneys will clean about 1 million gallons of blood in an average lifetime.

Did you know?

Fewer than 10% of babies are born on their exact due dates, 50% are born within 1 week of the due date, and 90% are born within 2 weeks of the date.

Did you know?

The word drug comes from the Dutch word droog (meaning "dry"). For centuries, most drugs came from dried plants, hence the name.

Survivorship curve for the North American beaver. Survivorship curve for the North American beaver.
A sigmoid (cooperative) binding curve A sigmoid (cooperative) binding curve
When the exhaust is lean, the output of a zirconia oxygen sensor is below 450 mV. When the exhaust is lean, the output of a zirconia oxygen sensor is below 450 mV.
Linear dose-response curve Linear dose-response curve
Possible Sources of Differences in Output per Worker Possible Sources of Differences in Output per Worker
The original Supply and Demand graph The original Supply and Demand graph
Video: Embryonic development - week 1 and 2

For a complete list of videos, visit our video library