Demand function-profit fuction

Assignment Help Microeconomics
Reference no: EM1367463

Acme Coffee Bean Company sells coffee beans to both retail grocery chains and commercial users (e.g., coffee shops, vending companies, etc.). The demand function for each of these markets is:

Retail grocery chains: P1 = 180 - 8Q1
Commercial users: P2 = 100 - 4Q2

where P1 and P2 are the prices charged and Q1 and Q2 are the quantities sold in the respective markets. Acme's total cost function (which includes a "normal" return to the owners) for coffee is:
TC = 50 + 20(Q1 + Q2)

a) Determine Acme's total profit function.

b) Assuming that Acme is effectively able to charge different prices in the two markets, what are the profit-maximizing price and output levels for the product in the two markets? What is Acme's total profit under this condition?

c) Assuming that Acme is required to charge the same price in each market, what are the profit-maximizing price and output levels? What is Acme's total profit under this condition?

Reference no: EM1367463

Previous Q& A

  Calculate an approximate cross cost elasticity of demand

Calculate income elasticity of demand for both X and Y at that point. Calculate an approximate cross cost elasticity of demand for Y when Px changes from 5 to 6.

  Estimate consumer and producer surplus before quota

Estimate aggregate consumer and producer surplus before quota. Estimate new consumer and producer surplus after quota.

  Explain specific challenges of facing designer

Explain specific challenges of facing the designer, specifically with regard to limitations of hardware, software and interface design two paragraph each.

  Examples of a medical office implementing ehr

Research and provide examples of a medical office that has implemented EHRs. How has it helped them? Has it created any negative aspects.

  Determine the growth rate of real gdp

Suppose last year's real GDP was $7,000 billion, this years nominal GDP is $8,820 billion, and GDP-deflator for this year is 120. Determine the growth rate of real GDP?

  Explain leaf of b tree which holds a sublist

Artificially small example of B+ tree is shown here (pdf). (Note only part of tree is shown in detail.) What nodes of example B+ tree are visited to find posting list for "dune"?

  Illustrate what do you think disrupted mcdonald plans

Within two weeks sales had fallen. Utilizing your knowledge of game theory, Illustrate what do you think disrupted McDonald's plans.

  Evidence-based practice report

Identify a research topic that you intend to investigate and write about as an evidence-based practice report Project Topic such as COPD, Asthma, Cancer or other health topics)

  Illustrate what is economy aggregate consumption function

Illustrate what is economy's aggregate consumption function. Illustrate what is marginal propensity to consume for economy.

  Determine supply and demand for labor

Many factors discuss the supply and demand for labor. Identify and describe two factors that would increase or decrease the demand for labor.


Write a Review


Similar Q& A

  Determine the price of computers in a free market

Examine the factors that determine the price of computers in a free market.

  Development game “settlers of catan”

Read the rules of the game, the overview and the almanac for the Development Game "Settlers of Catan"

  Determining principles of demand and supply

On Valentines Day, the prices of flowers and chocolate are usually high compared to other times. How do the principles of demand and supply describe the reasoning behind such price increases?

  Elasticity of price

Does it make sense to hold sleep, work, and leisure fixed while changing study? Why or why not? Explain why this model violates the assumption of no perfect collinearity.

  Analysis of price change of product-supply and demand

Use demand and supply analysis to illustrate the changes in chicken prices described in the article. Describe what has happened in the corn and soybean-meal markets and how that has influenced the chicken market.

  How can quantity demanded be changed

What are some things that would affect changes in supply? How can quantity demanded be changed and what if the government raised the minimum wage. How would this policy effect your firm?

  Regression modeling

Developing a regression model with Sample Regression Model

  Difference-equilibrium price and equilibrium quantity

Write down the difference between Equilibrium price and Equilibrium quantity. What role does elasticity place?

  What is the marginal rate of transformation

What is the Marginal Rate of Transformation between sugar and tea?

  Swot of the franchise

you must identify a franchise that is relatively new (less than 10 years old and fewer than 25 locations in Canada).  You must then evaluate the attractiveness of the franchise for an identified location.  The evaluation should include: Presentation ..

  Computing increase in sales volume-price elasticty

Angelica pickles manager a Quick copy franchise White Plains, New York. Pickles projects reducing copy 5¢ to 4¢ each, Quick Copy's $600-per-week profit contribution will increase by one-third.

  Derive the foc and soc conditions of profit maximization

Derive the FOC and SOC conditions of profit maximization for this firm. Show that SOC is satisfied (impose necessary conditions). Which plant will have a greater increase in output? Please explain why.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd