Determine the optimal price, Microeconomics

The largest public utility company in New South Wales (NSW) is the sole provider of electricity across all regions in the state. The monthly demand for electricity in NSW is given by the inverse demand function P = 1,000 - 5Q. The electricity company has set up two electric generating facilities: Q1 kilowatts are produced at facility 1 and Q2 kilowatts are produced at facility 2 (so Q = Q1 + Q2). The costs of producing electricity at each facility are given by C1(Q1) = 10,050 + Q12 and C2(Q2) = 5,000 + 2Q22, respectively.

a. Determine the profit-maximising amounts of electricity to produce at the two facilities.

b. Determine the optimal price.

c. Determine the utility company's profits.

Posted Date: 2/21/2013 1:21:06 AM | Location : United States







Related Discussions:- Determine the optimal price, Assignment Help, Ask Question on Determine the optimal price, Get Answer, Expert's Help, Determine the optimal price Discussions

Write discussion on Determine the optimal price
Your posts are moderated
Related Questions
Comparison with Our Needs: We can further test our performance by juxtaposing it with our requirements. Admittedly, it is very difficult to determine 'needed' rate of growth w

Question:  Explain the contribution of capital accumulation in the progress of an economy? Capital makes the technological progress of the economy possible. Different technol

Expected Utility: Theory Assume that a utility index exists which conforms to the five axioms. The expected utility for the two-outcome lottery L = (P, A, B) is given by,


Suppose that demand is downward sloping and supply upward sloping. Subsidies cause dead weight loss despite the fact that: 1)consumer surplus increases. 2)total surplus increases

Document Design It refers to the overall "look" and design rather than the content of a document. Specific elements such as white space, limited paragraph indentations, length

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Consider the following insurance market. There are two states of the world, B and G, and two types of consumers, H and L, who have probabilities pH =0.5 and pL =0.25 (high and low

If I submit an economics problem(Home work), How soon it will be answered?