Refer to the Following:
a Firm with Market Power Faces $Q _ { d } = 39,000 - 500 P + 0.4 M - 8,000 P _ { R }$

question 34

Multiple Choice

Refer to the following:
A firm with market power faces the following estimated demand and average variable cost functions:
$Q _ { d } = 39,000 - 500 P + 0.4 M - 8,000 P _ { R }$
$A V C = 30 - 0.005 Q + 0.0000005 Q ^ { 2 }$
where
$Q _ { d }$ is quantity demanded, P is price, M is income, and
$P _ { R }$ is the price of a related good. The firm expects income to be $40,000 and
$P _ { R }$ to be $2. Total fixed cost is $100,000.
-The firm should ______________ because _______________.

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Definitions:

Panic Disorder

A psychiatric disorder characterized by sudden episodes of intense fear or anxiety and physical symptoms based on a perceived threat rather than imminent danger.

Diagnosis

The identification of the nature and cause of an illness or other problem by examination of the symptoms and signs.

Relapse Rates

The proportion or percentage of individuals who, after recovery from a condition or disease, return to a state of illness or problem behavior within a certain period.

Treatments

Methods and practices used in the alleviation, relief, or cure of diseases, illnesses, or medical conditions.