Neco Model Questions Vol1 2025 Economics Question 3
Practice objective / multiple choice question 3 from the 2025 Neco Model Questions Vol1 Economics examination.
A firm has total cost (in million Naira) given by\n\n\[ TC = 0.04Q^{3} - 0.3Q^{2} + 30Q + 50, \]\n\nwhere \(Q\) is output in thousand units. The government imposes a specific tax of ₦40 per unit. The market price of the product is ₦500 per unit.\n\n(a) Determine the profit‑maximising output level after the tax and compute the resulting profit (in million Naira).\n\n(b) If the market price falls to ₦120 per unit, should the firm continue operating in the short run? Justify your answer.
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This is Neco Model Questions Vol1 2025 Economics Question 3. It is one of the objective questions from the 2025 Neco Model Questions Vol1 Economics examination.
Difficulty level: Hard .
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