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**Unformatted text preview: **Ch8 Student: ___________________________________________________________________________ 1. 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 = Q 1 + Q 2 . The marginal cost associated with producing in the two plants are MC 1 = 3Q 1 and MC 2 = 2Q 2 . How much output should be produced in plant 1 in order to maximize profits? A. 1. B. 2. C. 3. D. 4. 2. 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 = Q 1 + Q 2 . The marginal cost associated with producing in the two plants are MC 1 = 3Q 1 and MC 2 = 2Q 2 . What price should be charged to maximize profits? A. $20.5. B. $40.5. C. $60.5. D. $80.5. 3. 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 = Q 1 + Q 2 . The marginal cost associated with producing in the two plants are MC 1 = 3Q 1 and MC 2 = 2Q 2 . What price should be charged in order to maximize revenues? A. $39. B. $47. C. $52. D. $56. 4. Which of the following is true under monopoly? A. Profits are always positive. B. P > MC. C. P = MR. D. All of the choices are true for monopoly. 5. You are the manager of a firm that sells its product in a competitive market at a price of $50. Your firm's cost function is C = 40 + 5Q 2 . The profit-maximizing output for your firm is A. 4/5. B. 10. C. 5. D. 45. 6. You are the manager of a firm that sells its product in a competitive market at a price of $50. Your firm's cost function is C = 40 + 5Q 2 . Your firm's maximum profits are A. 125. B. 250. C. 100. D. 85. 7. You are the manager of a monopoly that faces a demand curve described by P = 230 - 20Q. Your costs are C = 5 + 30Q. The profit-maximizing output for your firm is A. 4. B. 5. C. 6. D. 7. 8. You are the manager of a monopoly that faces a demand curve described by P = 230 - 20Q. Your costs are C = 5 + 30Q. The profit-maximizing price is A. 150. B. 90. C. 130. D. 110. 9. You are the manager of a monopoly that faces a demand curve described by P = 230 - 20Q. Your costs are C = 5 + 30Q. Your firm's maximum profits are A. 495. B. 475. C. 480. D. 415. 10. 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 = Q 1 + Q 2 . The marginal cost associated with producing in the two plants are MC 1 = 2Q 1 and MC 2 = 4Q 2 . How much output should be produced in plant 1 in order to maximize profits? A. 3. B. 6. C. 9. D. 12. 11. 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 = Q 1 + Q 2 . The marginal cost associated with producing in the two plants are MC 1 = 2Q 1 and MC 2 = 4Q 2 . What price should be charged to maximize profits? ...

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