Answered: Ouroboros’ total cost (TC) as a…

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Proudction Costs

Section: Chapter Questions

Problem 8SQ

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Question

Ouroboros’ total cost (TC) as a function of its production level q is given by the equation
below:
TC(q) = 2?² − 12,000q + 30,000,000
a. How much is the fixed cost of production for Ouroboros?
b. If q=5,000, how much is the total cost for Ouroboros?
c. Evaluate the marginal cost for Ouroboros when q=3,000.
d. For this part, suppose that Ouroboros has two corporate customers. The first
corporations’ demand as a function of Ouroboros’ price is given by ??
(?) = 10,000 − ? and the second corporation’s demand function is given by ??(?) = 20,000 − ?.
Calculate Ouroboros’ maximum possible profit level.

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