Respuesta :
In this part, TC=100A First Derivative of TR-TC, which equals to zero, will provide us with a quantity of A that maximizes profit.
= 50a^2 - 200a - 100a
= 50a^2 - 300a
First Derivative of above
100a - 300
Set function = 0 and solve for a
100a - 300 = 0
100a = 300
a = 3
the profit-maximizing quantity of ads, a is 3
Profit-maximizing
In the field of economics, profit maximizing refers to the short- or long-term process through which a company chooses the prices, input levels, and output levels that result in the largest profit. The typical model of the firm in neoclassical economics, which is currently the dominant approach to microeconomics, is one that maximizes profit. The output of Q* is the point where MR and MC intersect in the supply and demand graph. When a company produces at this output level, earnings can be maximized. (MR=MC) The red portion of the graph indicated that MR is more than MC when produced less than the output of equilibrium quantity (Q*). The company produces more because it can earn more money than it has to spend. Thus, overall profit will rise. However, if the output level exceeds Q*, MR will apply.
Each fan pays the price of $10 per ticket, and ads are free (total cost = 0). now suppose the total cost function is 800a-50a2. what is the profit-maximizing quantity of ads, a*?
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