Discuss the importance of price elasticity of demand, income elasticity of demand and cross price elasticity of demand to a sales manager selling soft drinks like Coca Cola
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- Discuss the importance of
price elasticity of demand , income elasticity of demand and cross price elasticity of demand to a sales manager selling soft drinks like Coca Cola - If a firm faces the Marginal Cost schedule MC = 180 + 0.3Q2 and the MR schedule is MR = 540 = 0.6Q2 and that Total Fixed costs are $65. What is the maximum profit it can make? Assume that the second-order condition for maximum is met
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- Dalahla Company Limited, focusing on producing tooth paste (in units) has a demand function4? = 35 − 0.5?. If total fixed cost is GH¢80 and average variable cost per unit function is 3? −51+325/Q, where Q is number of tooth paste produced and P is the price per tooth paste (in GH¢).What is the total profit at the profit maximizing level of output, and what is the best pricing policyoption?AMCO is a firm producing tables in Spain. It has a fixed cost of 100$ and a cost per unit of production of 2$. The demand function for a table is given by: P = 60 - 4Q 1. Find the equations of TR and TC. 2. Write down the equation of the profit. 3. Find Qwhen TR = 0 (x-intercept/roots). 4. Find Qwhen TR is a maximum. 5. Deduce the maximum total revenue (TR max).Suppose the marginal cost and marginal revenue (in ¢000) for a product produced by a company is estimated to beMC=q+35 MR=560+22q−q2Where q is the quantity produced and the firm’s break-even is 5 units per weekYou are Required to1. determine the total cost and the total revenue function in terms of q.2. estimate the output at which profit is maximize3. calculate the maximum profit
- What is the demand function and cost function based on the set of data below? Price Quantity Profit $50 88 -$240 $25 289 -$240 $80 -$2000 $52 148 $1256 $51 143 $1003 $55 103 $575Teddy J is a manufacturer of dish washing liquid . If his monthly demand function for 750mlsize is q = 4000 − 250p and his total cost function is C(q) = 500 + 0.2q.(i) Derive an expression, R(q) for Teddy J′s total revenue curve.(ii) Derive an expression, Π(q) for Teddy J's profit function.(iii) Determine whether Teddy J′s profit is increasing or decreasing whenhe produces 5 hundred, 750ml bottles of dish washing liquid.(iv) How many 750ml bottles of dish washing liquid should Teddy J produceper month if he wishes to maximize his profits. thank you for your helpTeddy J is a manufacturer of dish washing liquid. If his monthly demand function for 750ml size is q= 4000 - 250p and his total cost is C(q) = 500+0.2q. 1. Derive an expression, R(q) for Teddy J total recenue curve. 2. Derive an expression, TT(q) for teddy j profit function. 3. Determine whether Teddy J profit is increasing or decreasing when he produces 5 hundred, 750ml bottles of dish washing liquid. 4. How many 750ml bottles of dish washing liquid should Teddy J produce per month if he wishes to maximize his profits.
- A major software developer has estimated the demand for its new personal finance software package to be Q=1,000,000P-2 while the total cost of the package is C = 10,000+ 25Q. If this firm wishes to maximize profit, what percentage markup should it place on this product where percentage markup is defined as 100*(sale price - marginal cost)/marginal cost? 4. a. b. C. d. e. ANS: 90% 100% 20% 40% 250%A startup software company has indicated its cost, c(x), and revenue, f(x), as given below, such that x is the number of lines of programing code (units in 1000 lines). c(x) = 80000 - 2(x-200)2 f(x) = (x-10)3 + (x+10)2 Find the marginal cost analytically, and draw its graph Find the marginal revenue analytically, and draw its graph Solve for the x point where marginal cost is equal to marginal revenue analytically. Comment why is this point significant analytically. Write the profit function and draw its graph Is the profit function concave up or concave down?Teddy J is a manufacturer of dish washing liquid. If his monthly demand function for 750 ml size is q = 4000-250p and his total cost function is C (q) = 500 + 0.2q. Determine whether Teddy J's profit is increasing or decreasing when he produces 5 hundred, 750 ml bottles of dish washing liquid
- PakPerfect Inc. estimates equation of its total costs of production as TC = 500 + 10Q + 5Q2 and market demand for its product as Qd = 105 – (1/2) P, where Q is quantity in units and P is price in Pak$. Write the equations of the firm’s costs, as a function of Q: Average Total Cost ATC Average Variable Cost AVC Average Fixed Cost AFC Given above costs can you determine what will be the firm’s production in Stage 1? What is the breakeven price and breakeven quantity for this firm? What is the shutdown price and quantity for this firm? Draw the firm’s costs in a graph as per your determination in (a). Label the breakeven and shutdown price and quantity using information in (b) and (c) above. Given the market price of Pak$ 50 how many units should the firm produce? how many firms are competing in this market in short-run? How many firms will be in the industry in the long-run? How do you interpret the profit or loss condition of PakPerfect? Use a two-panel graph of the Market and…A local microbrewery has total costs of production given by the equation TC=500+10q+5q2. This implies that the firm's marginal cost is given by the equation MC=10+10q (you do not need to be able to show this). The market demand for beer is given by the equation QD=105 – (1/2)*P. a) Write the equations showing the brewery's average variable cost.A local newspaper currently has 84,000 subscribers at a quarterly charge of $30.Market research has suggested that if the owners raise the price to $32, they wouldlose 5,000 subscribers. Assuming that subscriptions are linearly related to theprice, what price should the newspaper charge for a quarterly subscription tomaximize their revenue?a) Find the cost function (Hint: find slope and use point-slope form to find thecost function) b) Find the revenue function c) Find the maximum revenue d) Find the profit function