You Are the Manager of a Firm That Produces Output

question 99

Multiple Choice

You are the manager of a firm that produces output in two plants.The demand for your firm's product is P = 120 - 6Q, where Q = Q₁ + Q₂.The marginal cost associated with producing in the two plants are MC₁ = 2Q₁ and MC₂ = 4Q₂.What price should be charged in order to maximize revenues?

• A)6.
• B)2.
• C)24.
• D)60.

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Definitions:

Takeover

The acquisition of one company by another where the acquiring party secures control of the target company.

Merger

The combination of two or more companies into a single entity, often with the goal of achieving operational synergies or market growth.

Maximum Purchase Price

The highest price an investor is willing to pay to acquire a particular asset, often determined by assessing its value through various valuation methods.

Pre-Merger Value

The market value of a company before it enters into a merger agreement with another company.