Determine the profit function and profit maximizing value, Microeconomics

Assignment Help:

Yuen, a travelling salesman for snake oil, can produce the stuff at a marginal cost of 1. There are 100 potential customers in Vernon, each of whom has the following demand function for snake oil: P = 2 - y. The trouble is that none of the customers have any idea that Yuen is in town. The solution to his problem is, of course, advertising. The local radio station has explained to Yuen that their research shows that the probability that his message gets through to any one of the customers is [1 - 1/(1+A)], where A is the amount he spends on radio advertising.

a. What is Yuen's profit function?

b. What are the profit maximizing values of P and A?


Related Discussions:- Determine the profit function and profit maximizing value

Axioms of consumer preference, determine if completeness and transitivity a...

determine if completeness and transitivity are satisfied for the following preferences defined on x=(x1,x2)and y=(y1,y2);if x>y or x=y and x2>y2,if for min{x1,x2}

I am doing micro assignment, how to write the conclusion,i am doing the nik...

how to write the conclusion,i am doing the nike company.

Explain fiscal policy, Fiscal Policy Fiscal policy refers to the manage...

Fiscal Policy Fiscal policy refers to the management of government spending and tax policies to influence total desired spending so as to achieve the desired level of economic

Major air pollutants, Major air pollutants can be sub divided into 2 catexa...

Major air pollutants can be sub divided into 2 catexampleories: Inorganic gases and particular gases. (A) Inorganic gases 1. Carbon monoxide (CO) CO is a colourless, lethal gas

PPC schedule, 1)The productive capability of an economy is such that to pro...

1)The productive capability of an economy is such that to produce 5 units of military good it takes 2 workers to be employed while 10 units of consumer goods require 3 workers. Res

Marginal cost & marginal revenue, If Coolest IceCream ice cream parlor has ...

If Coolest IceCream ice cream parlor has been closing at 5pm with $120 of marginal revenue and $80 of marginal cost for the last hour open, what should Coolest IceCream do to maxim

Methods of forecasting, Methods of Forecasting The various methods o...

Methods of Forecasting The various methods of forecasting demand may be grouped under the followings categories: Opinion Polling Method: In this method the opinion

How to solve major economic problem as a CS engineer, how to solve major ec...

how to solve major economic problem as a computer engineer

Write Your Message!

Captcha
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