A firm has two plants with marginal costs: MC1(y )=3y+2 and MC2(y )=8y. Assuming that the firm is a price taker, at what price will the firm produce 27 units of output?
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- A competitive firm has a single factory with the cost function C(q) = 3q2 + 62 and produces 25 units in order to maximise profits. Although the price of output does not change, the firm decides to build a second factory with the cost function C(q) = 7q2 + 44. To maximise its profits, how many units should it produce in the second factory?A price-taking firm's variable cost function is C = Q3, where Q is the output per week. It has an avoidable fixed cost of $2,000 per week. Its marginal cost is MC = 3Q2. What is the profit maximizing output if the price is P = $192? Multiple Choice A. 0 B. 6 C. 10Ptarmigan Company produces two products. Product A has a contribution margin of $84.00 and requires 8 machine hours. Product B has a contribution margin of $133.90 and requires 13 machine hours. Determine the most profitable product assuming the machine hours are the constraint. If required, round your answers to two decimal places.
- ABC Company Limited is a new business established to produce tables (in units). The demand function for tables is given as 4? = 35 − 0.5?. It has been estimated that the total fixed cost is GH¢80 and average variable cost function is 3? − 51 + 320, where Q is number of tables produced ? and P is the price per table (in GH¢). Given this information, what is the total profit at the profit maximizing level of output, and what is the best pricing policy option?A competitive firm sells its product at a price of $0.10 per unit. Its total and marginal cost functions are: TC = 5 - 0.5Q + 0.001Q2 where TC is total cost ($) and Q is output rate (units per time period). a] Determine the output rate that maximizes profit or minimizes losses in the short term.an American multinational that sells consumer electronic products, has manufacturing facilities in three countries: Brazil, Thailand, and Canada. The average hourly wage rate, output per worker, and annual overhead cost for each location are as follows: Given the above figures, is Storm currently allocating its production resources optimally? If not, what should it do? Justify your answer. Now, suppose that Storm is planning to consolidate all its manufacturing into one facility. Where should it locate? Justify your answer.
- Suppose company XYZ produces a differentiated commodity. The company has substantial control over the price of the product. The company’s cost function is estimated to be TC = 200 – 20Q + Q2, where Q is the volume per day. The firm also has the following demand equation P = 60 – 2Q, where P represents the price per unit and Q the volume of daily sales. What level of output should management of XYZ produce? a. 30 b. 10 c. 20 d. 15The marginal profit function of a firm (profit (Π), point (Q) rate change depending on quantity) is MΠ = Π ^ '= dΠ / dQ = -2Q + 120. The fixed costs of the firm produced by the company are 1000 TL. In addition, the company is known to sell the goods it produces for 200 TL. Accordingly, answer the following questions.a) Find the firm's profit function.b) Find the cost function of the firm.The manufacturer of smart printers is trying to decide what price to set for its product. The demand and cost function are assumed to be as follows: P = 80 -2Q TC= 160 +50Q-1.5Q ² What price should the company charge if it wants to maximize its profit in the short run? What is the optimal quantity for the printer following this optimal price?
- Cambrian Railways runs a daily container freight train between Cardiff and Birmingham. Its major customer Welsh Farming Co-operative has a demand for containers by the equation: P = 410-5Q, where P is the unit selling price and Q is quantity of units in thousands. Cambrian's total cost function is given by the equation: TC = 3Q2 + 10Q – 100, where TC is total costs in thousands of dollars. Required: Identify two factors to consider when making pricing decisions within the organization.Problem 2:The Paradise Shoes Company has estimated its weekly TVC function from data collected over the past several months, as TVC = 3450 + 20Q + 0.008Q2 where TVC represents the total variable cost and Q represents pairs of shoes produced per week. And its demand equation is Q = 4100 – 25P. The company is currently producing 1,000 pairs of shoes weekly and is considering expanding its output to 1,200 pairs of shoes weekly. To do this, it will have to lease another shoe-making machine ($2,000 per week fixed payment until the lease period ends). Show all of your calculations and processes. Describe your answer for each item below in complete sentences, whenever it is necessary. Describe and derive an expression for the marginal cost (MC) curve. Describe and estimate the incremental costs of the extra 200 pairs per week (from 1,000 pairs to 1,200 pairs of shoes). What are the profit-maximizing price and output levels for Paradise Shoes? Describe and calculate the profit-maximizing…Problem 2:The Paradise Shoes Company has estimated its weekly TVC function from data collected over the past several months, as TVC = 3450 + 20Q + 0.008Q2 where TVC represents the total variable cost and Q represents pairs of shoes produced per week. And its demand equation is Q = 4100 – 25P. The company is currently producing 1,000 pairs of shoes weekly and is considering expanding its output to 1,200 pairs of shoes weekly. To do this, it will have to lease another shoe-making machine ($2,000 per week fixed payment until the lease period ends). What are the profit-maximizing price and output levels for Paradise Shoes? Describe and calculate the profit-maximizing price and output. Discuss whether or not Paradise Shoes should expand its output further beyond 1,200 pairs per week. State all assumptions and qualifications that underlie your recommendation. Show all of your calculations and processes. Describe your answer for each item below in complete sentences, whenever it is…