Ask Question, Ask an Expert


Ask Microeconomics Expert

problem 1: A firm has the given total revenue (TR) function:

TR = (4Q + 2) e4Q

Where Q is the Quantity.

Find out the firm’s marginal revenue function?

problem 2: A firm has the given inverse demand function:

P = [300/(Q - 4)] – 3

Where Q is the Quantity and P is the Price.

a) Find out the firm’s marginal revenue function.
b) Find out the level of output where the firm maximizes its total revenue.

problem 3: David has £5000 which he wishes to save for six years. Bank A offers him an interest rate of 4% per annum compounded monthly. Bank B offers him an interest rate of 3.95% per annum compounded constantly.

a) Compute how much David would have in each bank after six years.
b) Which Bank would give David the most interest? How much more interest?

problem 4: Categorize the four stationary points of the function:

z = 2x3 + y3 - 18 x – 12y + 50

according to whether they define a maximum, minimum or the saddle point.

problem 5: A firm’s total revenue (TR) is given by pq, where p is the price and q is the quantity sold.

Suppose the firm is initially selling 1000 units of its product at a price of 100 Euros. Then it increases the price by 10% which results in a reduction of 5% in quantity sold.

a) Use the total differential of the TR function to approximate the change in total revenue.
b) What percentage error results from using the differential compared with the true answer?

problem 6: The inverse demand and supply functions for a product are given as:

Pd = 900 – 0.25Q2d

Ps = 100 + 10Qs

Where P is the price, Q is the quantity and the subscripts d and s indicate demand and supply, respectively.

a) Compute the equilibrium price and quantity.

b) By using the definite integral, compute the consumer and producer surpluses at the equilibrium position.

c) Describe your answers to part (a) and (b) on an appropriate diagram.

d) The government introduces a specific tax of 59. What will be the price and quantity at the new equilibrium?

e) Show the new equilibrium price and quantity on your diagram drawn for part (c).

problem 7:

a) A firm manufactures and sells a product that has the following demand function:

Q = 180 - 4P

Where P is the price, Q is the quantity. It too faces the given total cost (TC) function:

TC = 0.033Q2 + 15Q + 150

Where Q is the quantity produced.

i) Compute the firm’s profit function.

ii)  By using your profit function find outd in part (i) find the level of output where the firm maximizes its profit.

iii) How much profit will the firm make if it sells the profit maximizing level of output?

b) The firm is considering manufacturing a second product in its factory alongside the first. The demand functions for the two products are:

Qd1 = 180 – 4P1
Qd2 = 90 – 2P2

Where the subscripts 1 and 2 refer to product 1 and product 2 correspondingly. The firm now faces a total cost function:

TC = Q + 150

Where Q = Q1 + Q2

i) Compute the new total profit function for the firm as a function of Q1 and Q2.

ii) By using your new profit function find outd in part (b)(i) find the level of output for each product at the profit maximizing point and show your outcome is a maximum.

iii)  Find the price charged for each product and the profit the firm would earn if adopting a profit maximizing strategy.

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91071

Have any Question? 

Related Questions in Microeconomics

Economic paper projectthe microeconomic paper tests your

Economic Paper Project The Microeconomic Paper tests your ability to apply economic principles to a business decision. Select one situation from the items outlined below: A toD. Complete the paper on the selected situati ...

Topic 1 price elasticity of demand and government

Topic 1: Price Elasticity of Demand and Government Revenue Based on the assessments of price elasticity of demand, some goods are demand-elastic whereas others are demand inelastic. Our consumption pattern also depends o ...

Microeconomics assignmentdirections unless otherwise stated

Microeconomics ASSIGNMENT Directions: Unless otherwise stated, answer in complete sentences, and be sure to use correct English, spelling and grammar. Sources must be cited in APA format. Your response should be four (4) ...

Part awe have discussed several examples of constrained

Part A: We have discussed several examples of constrained utility maximisation in lectures and in classes. For example, we have learned how to find the optimal bundle of goods consumed by an individual trying to maximise ...

Assignmentthis final project paper will utilize many of the

Assignment This final project paper will utilize many of the sections of material you have studied during the duration of this course. You will make use of your own personal observations and occupational experiences to e ...

Recall from lecture the two facts we discussed one no

Recall from lecture the two facts" we discussed: One, no product exists at a vacuum; and two relationships among products change over time. Recall the background factors of demand: consumer preferences/ Wants; consumer i ...

Question - determined that the cost of supplies on hand was

Question - Determined that the cost of supplies on hand was Tk. 1500 and Tk. 1200 of supplies had been used during the month.

Advocating for data driven programthis discussion meets

Advocating for Data Driven Program This discussion meets CACREP standards: I2, I4, and J1. Scenario: You are a new school counselor in a school that has not been using data to drive the school counseling program. The vet ...

From the scenario for katrinas candiessuggest one1method in

From the scenario for Katrina's Candies,suggest one(1)method in which Herb could use a cost-benefit analysis to argue for or against an expansion. Create three optimal decision rules for Katrina's Candies(e.g.,whether to ...

Microeconomics - cost elements of a businessassignmentin

Microeconomics - Cost Elements of a Business Assignment In this Assignment, you will define and calculate the remaining six major cost elements of a business, when given the Total Costs and the Quantity Produced, as well ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate