A company operates two plants which manufacture the same item and whose total cost functions are C₁ = 5.1 +0.04(91)² and C₂ = 7.4 + 0.02(92)², where q₁ and q₂ are the quantities produced by each plant. The company is a monopoly. The total quantity demanded, q = 91 + 92, is related to the price, p, by p = 40 -0.02q. How much should each plant produce in order to maximize the company's profit?¹ 91 = 92 || i

A company operates two plants which manufacture the same item and whose total cost functions are C₁ = 5.1 +0.04(91)² and C₂ = 7.4 + 0.02(92)², where q₁ and q₂ are the quantities produced by each plant. The company is a monopoly. The total quantity demanded, q = 91 + 92, is related to the price, p, by p = 40 -0.02q. How much should each plant produce in order to maximize the company's profit?¹ 91 = 92 || i

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter25: Monopoly

Section: Chapter Questions

Problem 10E

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