Practice Questions on Single-value function differentiation

1. A firm has the following total revenue and total cost functions; TR  100  x and
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TC  x 2  x . Find the maximum profit.
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2. The total cost function for a firm is given by 𝐶 = 3 𝑥 3 − 5𝑥 2 + 30𝑥 + 10. If the market
demand function is given by 𝑝 = 2530 − 5𝑥, where ₵p is the price per unit of output, find
the profit maximizing output and price.
3. A firm has the revenue function 𝑇𝑅 = 200𝑥 − 0.1𝑥 2 and the cost function 𝑇𝐶 = 50𝑥 +
20,000. Find the profit maximising output and hence the maximum profit.
4. The total cost, C of producing tractors, t , by a firm is given by
 t3 4
C  7t 2  40t  and the firm’s demand function for a tractor is given by
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P  16  2t where t is the number of tractors produced, and P is the price of a tractor in
ten thousands of Ghana Cedis.
(a) Find the output level that makes the firm break-even.
(b) If the objective of the firm is to minimize cost, how many tractors will the firm produce and
what will be the minimum cost?
(c) Find the number of tractors to be produced by the firm to maximize profit.
(d) Find the price of a tractor and the maximum profit the firm can make.
5. Egogo Electrical Company Ltd has a demand function given by 2Q  160  3P  0 and an
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average cost curve given by the relationship AC  3Q 2  63   180Q , where P is the
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price per tonne in millions of Cedis, Q is the quantity of electrical products produced per
year in tonnes, and AC is the average cost per year in millions of Cedis.
(a) Find the level of output that maximizes total revenue
(b) Find an expression for marginal revenue.
6. The Total Revenue function of a company is given as TR  100Q  5Q 2  280 ; find the
value of Q that maximizes total revenue.
7. Given that the demand function for a firm is P  10  Q and the total cost function is
TC  5Q 2  50Q  500 ,
(i) Find an expression for the Total Revenue
(ii) At what values of Q and P will Total Revenue be maximized?
(iii) At what value of Q will total cost be minimized?
(iv) Find the minimum total cost
(v) Find the output level that maximizes profit and the maximum profit.
8. The total cost of making x units of a product is C  0.00005 x 3  0.06 x 2  10 x  20000 .
Find the Marginal cost when 1000 units are produced.
9. The demand function for the producer of a monopoly product is given as Q  100  4 P .
(i) Find the Total Revenue (TR), Average Revenue (AR) and Marginal Revenue (MR)
functions.
 (ii) At what level of output is Total Revenue a maximum?
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10. A firm produces x tonnes of output at a total cost, TC  x  5 x 2  10 x  5 . At what
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level of output will marginal cost and average cost attain their respective minimum?
11. The TC and TR of a firm are given by C  x 3  12 x 2  48 x  11 and R  83x  4 x 2  21 .
Find the output level
(i) when the revenue is maximum
(ii) When profit is maximum
12. The short-run production function of a firm is given by Q  6L2  0.2 L3 where L denotes
the number of workers. Find the size of the workforce that maximizes the average product
of labour.
13. A consumer’s utility function is given as U  8 x  x 2  10 ln x where x is the number
oranges consumed. Find the maximum utility the consumer can derive from consuming
oranges.
14. The sales function, S , of a marketing department of a firm given by S  9 ln x  7 x  x 2
where x is the advertising expenditure in thousands of Ghana Cedis. Find the how much
that should be spent on advertising to maximize sales of the firm.
15. The functional representation of Kofi’s returns R , in thousands of Cedis, from investing in
fixed deposits at a bank given as R  ln i  i 2  i where i is the interest rate paid on the
investment. Find the maximum returns he can make.