Neco 2019 Economics Question 38

Practice objective / multiple choice question 38 from the 2019 Neco Economics examination.

Neco 2019 Economics Objective / Multiple Choice Medium Difficulty
Question 38 NECO • 2019 • ECONOMICS • objective

A firm's total cost function is \(TC = 5000 + 20Q + 0.05Q^{2}\) where \(Q\) is output units. The market price per unit is initially \(\text{₦}80\).\n\n(a) Find the output level at which the firm breaks even at the initial price.\n(b) If the price rises to \(\text{₦}90\), determine the profit when the firm produces the output that maximises profit at the new price.\n(c) Calculate the percentage increase in profit compared with the profit at the initial price when each price's profit‑maximising output is used.

Answer Options

A. (a) Approximately 80 units; (b) Profit = ₦15,000; (c) 30% increase
B. (a) Approximately 85 units; (b) Profit = ₦18,000; (c) 45% increase
Correct Answer C. (a) Approximately 90 units; (b) Profit = ₦19,500; (c) 50% increase
D. (a) Approximately 100 units; (b) Profit = ₦22,000; (c) 60% increase
Correct Answer
C
Correct Option:
(a) Approximately 90 units; (b) Profit = ₦19,500; (c) 50% increase

About This Question

This is Neco 2019 Economics Question 38. It is one of the objective questions from the 2019 Neco Economics examination.

Difficulty level: Medium .

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