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Can you offer Econ help for this question????
A Bavarian crystal company designs and produces crystal wine decanters. The production manager estimates a total cost (TC) and marginal cost (MC) of production to be
TC=10,000 = 40 Q + 0.0025 Q2 and MC= 40 +0.005 Q
where Q is the number of wine decanters produced and revenues and costs are in dollars. Because the company is only one of many crystal producers in the market, it can sell as many many decanters it wants at the market price of $70. Because it is a price taker, its total revenue (TR) and marginal revenue (MR) are
TR= P x Q =70 Q and MR=70
a. Find the optimal level of production of wine decanter. Please show work
b. Calculate the total revenue (TR), total cost (TC), and net benefit (profit) from selling the optimal number of wine decanters
2 Answers
- Anonymous1 decade agoFavorite Answer
MR=MC is usally the best answer to Econ questions. So:
70=40+.005Q
70/.005=40 +Q
(70/.005)+40=Q
Q=14040
Then just plug 14040 into the TR and TC equasions, and the net benefit is the difference.
- Anonymous1 decade ago
Maybe you could do your own homework.