demand and cost functions
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2. The demand and cost functions for a company are estimated to be as follows:
P = 100 - 8Q
TC = 50 + 80Q - 10Q2 + 0.6Q3
a) What price should the company charge if it wishes to maximize its profit in the short-run?
b) What price should it charge if it wishes to maximize revenue in the short-run?
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The demand and cost functions for a company are highlighted.
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a) What price should the company charge if it wishes to maximize its profit in the short-run?
The total revenue is TR = PQ = 100Q - 8Q2
Then the marginal revenue is MR = dTR/dQ
or MR = 100 - ...
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