Iqra Tahreem

Bc180405943
Assignment 2

TR = 150 Q – 4 Q2
TC = 40 + 10 Q + 3 Q2
a) Profit maximize at point where
MC = MR
dTC
MC = = 6 Q + 10
dQ
dTR
MR = = 150 – 8 Q
dQ
MR = MC
Putting the values overhead
150 – 8 Q = 6 Q + 10
Or
-8 Q – 6 Q = 10 – 150

-14 Q = -140
Or
−140
Q=
−14
Q = 10
(b) TΠ = TR – TC
= 150 Q – 4 Q2 – 40 – 10 Q – 3 Q2
Or
= 150 Q – 10 Q – 40 – 4 Q2 – 3 Q2
= 140 Q – 40 – 7 Q2

We know that Q = 10
So, we can write that
= 140 (10) – 40 – 7 (10)2
= 1400 – 40 – 7 (100)
= 1400 – 40 – 700
 TΠ = 660
TR
(c) AR =
Q

150Q−4 Q 2
AR =
Q

Taking Q common from above side

Q(150−4 Q)
AR =
Q
AR= 150 – 4 Q

We know that Q = 10
So, we can write that
AR = 150 – 4 (10)
AR= 150 – 40
AR= 110
Slope of MR Curve is Twice the Slope of AR Curve.
Slope of AR is obtained by differentiating AR function w.r.t Q.