Pauline the perfect competitor can sell all of the output she
wants at a price of $800 per unit. She has a total cost function
of: TC = 140,000 + 80Q + .07Q2.
Calculate Pauline’s profit maximizing quantity and her maximum
Calculate the quantity at which average cost is a minimum. What
is minimum average cost?
Graph the demand, marginal revenue, marginal cost and average
Shade in the area that represents the profits of Pauline’s
Graph the total revenue and total cost functions and show the
point at which Pauline is maximizing profits.