You Are the Manager of a Firm That Produces Output

question 58

Multiple Choice

You are the manager of a firm that produces output in two plants.The demand for your firm's product is P = 96 − 15Q,where Q = Q₁ + Q₂.The marginal costs associated with producing in the two plants are MC₁ = 6Q₁ and MC₂ = 3Q₂.How much output should be produced in plant 2 in order to maximize profits?

• A) 1
• B) 2
• C) 3
• D) 4