ch02 - File Ch02 CHAPTER 2 Optimal Decisions Using Marginal...

Info icon This preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
File: Ch02; CHAPTER 2: Optimal Decisions Using Marginal Analysis Each question contains a code showing the section of the chapter text from which it was taken. The codes for this chapter are: Code Section 1 A Simple Model of the Firm 2 Marginal Analysis 3 Marginal Revenue and Marginal Cost 4 Sensitivity Analysis 5 Appendix MULTIPLE CHOICE 1. In the simple model of the firm, management's main tasks are to a) Set the quantity of output and estimate costs. b) Set output quantity and price. c) Set price and estimate revenue. d) Determine the scale of operation and estimate profit. e) Set advertising spending and price. ANSWER: b SECTION: 1 2. According to the model of the firm, management’s main goal is to 3. According to the law of demand, if a firm reduces the price of its good 4. According to the simple model of the firm, management can predict 2-1
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Optimal Decisions Using Marginal Analysis 5. Demand is given by Q = 600 - 30P. At price P = $15, the firm’s unit sales are a) 100. b) 150. c) 300. d) 450. e) 600. ANSWER: b SECTION: 1 6. Demand is given by: P = 1,750 - 25Q. If the firm wishes to sell 50 units, the requisite price is 7. The firm’s demand curve is given by Q = 800 - 2P. Therefore, its inverse demand curve is 8. A firm’s total cost function is given by: C = 100 + 10Q + 2Q 2 . At Q = 10, 2-2
Image of page 2
Chapter 2
Image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern