Express the firms marginal revenue as function of its price

Assignment Help Business Economics

Reference no: EM131236900

The manager of a local monopoly estimates that the elasticity of demand for its product is constant and equal to –3. The firm’s marginal cost is constant at $20 per unit. a. Express the firm’s marginal revenue as a function of its price. Instruction: Round your response to 2 decimal places. MR = x P b. Determine the profit-maximizing price. Instruction: Use the rounded value calculated above and round your response to 2 decimal places. $

Reference no: EM131236900

Questions Cloud

Natural rate of unemployment : Use the AS/AD framework to depict an economy that a) is in equilibrium, and b) has an Unemployment Rate that is less than its Natural Rate of Unemployment. Suppose that Real GDP in the Rest-of-the-World (the ROW) begins to fall.

Depict an economy that equilibrium and unemployment rate : Use the AS/AD framework to depict an economy that is a) in equilibrium, and b) has an Unemployment Rate that is greater than its Natural Rate of Unemployment.

Equilibrium and operating at full employment : Use the AS/AD framework to depict an economy that is a) in equilibrium, and b) operating at full employment. Now suppose that the Business Sector decides to increase the Price Level it desires to charge, at any and every given level of production: La..

Example of price discrimination on the part of the firm : If you purchased a new model of a digital camera right after it is released you will likely pay more than if you purchase it six months after release. Why is this example of price discrimination on the part of the firm?

Express the firms marginal revenue as function of its price : The manager of a local monopoly estimates that the elasticity of demand for its product is constant and equal to –3. The firm’s marginal cost is constant at $20 per unit. a. Express the firm’s marginal revenue as a function of its price. Instruction:..

Economic well-being of a nation when a tariff is imposed : What is the effect on the economic well-being of a nation when a tariff is imposed? Consult a newspaper and identify an industry where there currently is a tariff. What is the effect of this tariff on the U.S. economy?

New performance comparison system : Assume ESPN introduces a new performance comparison system for NBA players (basketball), i.e. preference relation for ranking players as strictly better, weakly better or indifferent (equally good). ESPN’s new criterion (the preference relation) is d..

The owners would be faced with what challenges : In a 100% socialist structure, the owners would be faced with what challenges? hey lose the opportunity to make and hold onto extreme profits. They assume all the financial risk if their businesses fail. They no longer can change careers because they..

Consider the production possibilities curve : Consider the production possibilities curve for a nation that can produce either consumption or investment goods. Describe and show the impact of each of the following using the PPF diagram.

User Account

All Pages