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Delvig [45]
3 years ago
5

A firm sells its product in a perfectly competitive market where other firms charge a price of $110 per unit. The firm estimates

its total costs as C(Q) = 70 + 14Q + 2Q2. a. How much output should the firm produce in the short run?
Business
1 answer:
klemol [59]3 years ago
8 0

Answer: 24 units.

Explanation:

Price(P) = 110

C(Q) = 70 + 14Q + 2Q²

The output level will be gotten when price e equals to the marginal cost.

Since C(Q) = 70 + 14Q + 2Q², the marginal cost (MC) will be: 14 + 4Q.

Therefore, P = MC

110 = 14 + 4Q

4Q = 110 - 14

4Q = 96

Q = 96/4

Q = 24

In the short run, the firm will produce 24 units.

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