Neco Model Questions Vol1 2021 Economics Question 48

Practice objective / multiple choice question 48 from the 2021 Neco Model Questions Vol1 Economics examination.

Neco Model Questions Vol1 2021 Economics Objective / Multiple Choice Hard Difficulty
Question 48 NECO_MODEL_QUESTIONS_VOL1 • 2021 • ECONOMICS • objective

An agricultural firm's total cost of producing \(Q\) tonnes of maize is given by \(TC = 200 + 5Q + 0.02Q^{2}\) (₦ thousand). The market price per tonne follows the linear demand function \(P = 120 - 0.5Q\). (a) Find the output level that maximizes profit and compute the maximum profit (in ₦ thousand). (b) If the government introduces a per‑tonne tax of ₦10, determine the new profit‑maximising output and the corresponding profit (in ₦ thousand).

Answer Options

A. a) Q≈108.3 t, profit≈6,300 thousand ₦; b) Q≈95.0 t, profit≈4,900 thousand ₦
B. a) Q≈95.2 t, profit≈5,200 thousand ₦; b) Q≈87.5 t, profit≈4,800 thousand ₦
Correct Answer C. a) Q≈110.6 t, profit≈6,158 thousand ₦; b) Q≈101.0 t, profit≈5,101 thousand ₦
D. a) Q≈120.0 t, profit≈6,500 thousand ₦; b) Q≈110.0 t, profit≈5,800 thousand ₦
Correct Answer
C
Correct Option:
a) Q≈110.6 t, profit≈6,158 thousand ₦; b) Q≈101.0 t, profit≈5,101 thousand ₦

About This Question

This is Neco Model Questions Vol1 2021 Economics Question 48. It is one of the objective questions from the 2021 Neco Model Questions Vol1 Economics examination.

Difficulty level: Hard .

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