A firm faces the demand equation $P = 120 - 0.5Q$ where $P$ is the price per unit (in naira) and $Q$ is the quantity sold. Its total cost function is $TC = 2000 + 20Q + 0.02Q^{2}$. Determine the output level that maximises profit and state the maximum profit (in naira).

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Accepted Answer

Q \approx 96 units; maximum profit \approx ₦2,808

Neco Model Questions Vol1 2024 Economics Question 31

A firm faces the demand equation \(P = 120 - 0.5Q\) where \(P\) is the price per unit (in naira) and \(Q\) is the quantity sold. Its total cost function is \(TC = 2000 + 20Q + 0.02Q^{2}\). Determine the output level that maximises profit and state the maximum profit (in naira).

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