You Are the Manager of a Firm That Produces Output

question 131

Multiple Choice

You are the manager of a firm that produces output in two plants.The demand for your firm's product is P = 78 − 15Q,where Q = Q₁ + Q₂.The marginal costs associated with producing in the two plants are MC₁ = 3Q₁ and MC₂ = 2Q₂.What price should be charged in order to maximize revenues?

• A) $39
• B) $47
• C) $52
• D) $56

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Definitions:

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A curve depicting the maximum possible output combinations of two goods that can be produced with available resources and technology.

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The increase in the inflation-adjusted market value of the goods and services produced by an economy over time, typically measured as the percent rate of increase in real gross domestic product (GDP).