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The market for internet services is perfectly competitive. Joe’s Internet Services has total cost function TC(q) = 6q2 + 5q + 20 and marginal cost function MC(q) = 12q + 5.
(a) The current price per unit of internet services is $53. Determine the output level that maximizes Joe’s profit in the short run. Determine the resulting profit for Joe’s
(b) The coefficient on the q term in the total cost function depends on a robotics input price. Suppose this input price increases to 7. Draw a single graph depicting the market price (still $53), the initial MC curve (before the increase in the input price) and Joe’s initial profit-maximizing choice; and the new MC curve (after the increase in the input price) and Joe’s new profit-maximizing choice. Be sure to explicitly show the coordinates for intercepts and for any other important points in the graph.
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A firm contemplating entering the market would need to invest $100 million to build a minimum efficient scale production plant (or about $10 million annually on an amortized basis). Such a plant could produce about 100 million pounds of cereal per ye..
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Office building maintenance plans call for the stripping, waxing, and buffing of ceramic floor tiles. This work is contracted out to maintenance firms, and both technology and labor requirements are very basic.
What is the dominant source of capital funding in the United States? Given this result and the fact that most corporations are net borrowers, what decisions must most managers face in order to address this financial deficit?
Suppose an economy is characterized by the following equations: C= 520 + 0.6 Yd Yd = Y - T I = 500 G = 500 T = 400. Is this economy closed or open? Explain. Determine the following: 1) The equilibrium level of GDP(Y)
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