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Q. AMS recently instituted an in-house recycling program. Profits of this program include not only profits to environment of recycling however also goodwill generated by AMS's leadership in this area. Costs of recycling include all of energy, labour and space required to do recycling. Assume se profits and costs are given by TR (Q)=100Q - 2Q2 and TC(Q) = 2Q (Note that MR = 100 - 4Q and MC= 2 ).

a. Illustrate what level of Q maximizes profit of recycling?

b. Illustrate what is marginal profit (income) at this level of Q?

c. Illustrate what is marginal cost at this level of Q?

d. Illustrate what level of Q minimizes total costs of recycling?

e. Illustrate what level of recycling is optimal? Why?

 

Business Economics, Economics

  • Category:- Business Economics
  • Reference No.:- M9292711

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