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A monopoly firm faces a demand curve of D(p) = 80 5P. The firm produces 35 units, and - operates at a constant marginal cost, with fixed costs of zero. The firm wants to maximize its profit. How much profit will the firm obtain?

a) 245
b) 315
c) 14
d) 9
e) 210

User Shevone
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To determine the profit obtained by the monopoly firm, we need to follow these steps: 1. Calculate the firm's total revenue: Total Revenue = Price * Quantity The price is determined by the demand curve equation: D(p) = 80 - 5P Substituting the quantity produced (35 units) into the equation, we get: Price = 80 - 5 * 35 = 80 - 175 = -95 (Note: A negative price is not possible) Therefore, the firm cannot sell any units at a price that maximizes profit, and there will be no revenue. 2. Calculate the total cost: Total Cost = Fixed Cost + Variable Cost Given that the fixed cost is zero and the firm operates at a constant marginal cost, we only need to calculate the variable cost. Since the marginal cost is not provided, we cannot determine the variable cost and the total cost. Without knowing the variable cost and the total cost, we cannot calculate the profit obtained by the firm. Therefore, it is not possible to determine the correct answer from the options provided (a, b, c, d, e). 100 Words.
User Mike Minicki
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