Microeconomics Answers

A firm has analyzed its operating conditions, prices, and cost have developed the following functions: R = 400 – 4q2 (per thousand naira) and Cost = q2 + 10q + 30 (per thousand naira) where q is the number of units produced and sold. If the firm wishes to maximize profit:

(a) What quantity should be sold and at what price?

(b) What will be the amount of profit?

2. Find the point of maximum value of the revenue function given as P = 400 – 4q. Hence, find the revenue.

1. A firm has analyzed its operating conditions, prices, and cost have developed the following functions: R = 400 – 4q2 (per thousand naira) and Cost = q2 + 10q + 30 (per thousand naira) where q is the number of units produced and sold. If the firm wishes to maximize profit:

(a) What quantity should be sold and at what price?

(b) What will be the amount of profit?

2. Find the point of maximum value of the revenue function given as P = 400 – 4q. Hence, find the revenue.

1.      Given market demand Qd = 50 - P, and market supply P = Qs + 5

A.      Find the market equilibrium price and quantity

2.      Given utility function U= where PX = 12 Birr, Birr, PY = 4 Birr and the income of the consumer is, M= 240 Birr.

A.      Find the utility maximizing combinations of X and Y.

B.      Calculate marginal rate of substitution of X for Y (MRSX,Y) at equilibrium and interpret your result

Consider the perfectly competitive market for Diesel. The aggregate demand for gasoline is

The aggregate demand for gasoline is

Q_d=100-p

While the aggregate supply is Q_s= 3p

Work out the equilibrium price and quantity.