Essay
A firm produces two products, r and s, and the production process is such that one unit of r is always obtained with one unit of s. The demand curves for r and s are estimated to be:
Qr = 75 - Pr
Qs = 100 - .5Ps
and the marginal cost of production is MC = 75 + 4Qj, where Qj consists of one unit of each product.
a. How much of product r and product s should the firm sell to maximize profits?
b. At what price should these products sell?
Correct Answer:
Verified
a.TR = TRr + TRs
= PrQr + PsQs
Qr = 75 - Pr; the...View Answer
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Correct Answer:
Verified
= PrQr + PsQs
Qr = 75 - Pr; the...
View Answer
Unlock this answer now
Get Access to more Verified Answers free of charge
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