The Long-Run Cost Function for LeAnn's Telecommunication Firm Is: C(q)

question 66

Essay

The long-run cost function for LeAnn's telecommunication firm is: C(q) = 0.03q². A local telecommunication tax of $0.01 has been implemented for each unit LeAnn sells. This implies the marginal cost function becomes: MC(q, t) = 0.06q + t. If LeAnn can sell all the units she produces at the market price of $0.70, calculate LeAnn's optimal output before and after the tax. What effect did the tax have on LeAnn's output level? How did LeAnn's profits change?

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Definitions:

Slide into Deviance

The gradual process by which an individual's actions or behaviors become increasingly non-conformist or criminal, often unnoticed until significant boundaries are crossed.

Deterrence Doctrine

A strategy in international relations and criminal justice aiming to prevent undesirable actions by fear of punishment, often used in the context of nuclear strategy and criminal law.

Rate of Crime

The frequency or number of criminal acts within a specific time frame or geographical area.

Differential Association Theory

A theory proposed by Edwin H. Sutherland positing that criminal behavior is learned through social interactions with others.