Neco 2018 Economics Question 44

Practice objective / multiple choice question 44 from the 2018 Neco Economics examination.

Neco 2018 Economics Objective / Multiple Choice Medium Difficulty
Question 44 NECO • 2018 • ECONOMICS • objective

A firm's total cost function is \(TC = 0.5Q^{2}+20Q+100\) (naira) and its total revenue function is \(TR = 80Q - Q^{2}\). Determine the output level that maximizes profit, compute the maximum profit, and state whether the firm should shut down in the short run if the market price equals average revenue.

Answer Options

A. Output Q = 20 units; maximum profit = 400 naira; continue operating
B. Output Q = 15 units; maximum profit = 300 naira; continue operating
Correct Answer C. Output Q = 20 units; maximum profit = 500 naira; continue operating
D. Output Q = 25 units; maximum profit = 600 naira; shut down
Correct Answer
C
Correct Option:
Output Q = 20 units; maximum profit = 500 naira; continue operating

About This Question

This is Neco 2018 Economics Question 44. It is one of the objective questions from the 2018 Neco Economics examination.

Difficulty level: Medium .

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