ECON MICRO
5th Edition
ISBN: 9781337000536
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 9, Problem 6.9P
To determine
The manner in which the firms make profit while practicing
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question7)
the following is the total cost function and demand function of a certain firm
TC= 100 +20Q + 7QQd = 130-2Pa)- What is the type of this market? why?
b)Calculate the profit maximizing level of output and price for this firm.
c) Does the firm make profit or loss at this level of output? Why?
d)Should the firm produce this level of output or shut down? Why?
please all do subparts because I have very urgent solution
Question 1
You are the country manager of a firm that produces and markets a generic type of soft
drink in a competitive market in Ghana. In addition to the large number of generic products
in your market, you also compete against major brands such as Coca-Cola and Pepsi.
Suppose that, due to the successful lobbying efforts of sugar producers in Ghana,
Parliament levies a ȼ1.20 per pound tariff on all imported raw sugar: the primary input for
your product. In addition, Coke and Pepsi launches an aggressive advertising campaign
designed to persuade consumers that their branded products are superior to generic soft
drinks. How will these events impact the market outcomes of generic soft drinks if effect of
the tariff is larger the effect of advertising of Coke and Pepsi on the generic type of soft
drink? Explain with an appropriate graph
16
The marginal revenue for a price searcher is:
more than total revenue.
less than the level of output.
less than marginal cost.
less than the price.
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