Gce Model Questions Vol1 2019 Economics Question 29

Practice objective / multiple choice question 29 from the 2019 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2019 Economics Objective / Multiple Choice Hard Difficulty
Question 29 GCE_MODEL_QUESTIONS_VOL1 • 2019 • ECONOMICS • objective

An intensive poultry farm has total cost (in ₦) given by \( TC = 0.05 Q^{2} + 40 Q + 3000 \), where \( Q \) is the number of thousand eggs produced per month. The market demand for eggs is described by the inverse demand function \( P = 150 - 0.1 Q \) (price per thousand eggs).\ (i) Determine the output level \( Q \) that maximises the farm's monthly profit.\ (ii) Compute the maximum profit (in ₦).\ (iii) State whether the farm is operating in the region of increasing or decreasing marginal cost at this output.

Answer Options

Correct Answer A. (i) Q = 366.7 thousand eggs (≈); (ii) maximum profit ≈ ₦17,167; (iii) increasing marginal cost
B. (i) Q = 300 thousand eggs (≈); (ii) maximum profit ≈ ₦15,000; (iii) decreasing marginal cost
C. (i) Q = 250 thousand eggs (≈); (ii) maximum profit ≈ ₦12,500; (iii) decreasing marginal cost
D. (i) Q = 400 thousand eggs (≈); (ii) maximum profit ≈ ₦20,000; (iii) decreasing marginal cost
Correct Answer
A
Correct Option:
(i) Q = 366.7 thousand eggs (≈); (ii) maximum profit ≈ ₦17,167; (iii) increasing marginal cost

About This Question

This is Gce Model Questions Vol1 2019 Economics Question 29. It is one of the objective questions from the 2019 Gce Model Questions Vol1 Economics examination.

Difficulty level: Hard .

View More Gce Model Questions Vol1 2019 Economics Questions More Gce Model Questions Vol1 Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support