1.

Determine whether solutions exist for each of the following quadratic

equations. Where they do find the solution(s).

Firstly determine whether solutions exist using the following criteria:

Two solutions
One solution
No solution

Secondly find the solution where possible using the formula:

(i)
a=1, b=-2, c=0
two solutions exist

(ii)
Multiply out the quadratic

Divide across by 3

a=1, b=-1, c=-2

two solutions exist

(iii)
a=9, b=-24, c=16
one solution

(iv)
a=3, b=2, c=3
no solution
 (v)
a=2, b=11, c=-21
two solutions

(vi)
a=-2, b=1, c=10
two solutions

2 A firms demand function for a good is given by P = 107-2Q and their total
cost function is given by TC = 200+3Q .
i) Obtain an expression for total revenue profit in terms of Q
Total Revenue = P.Q
TR = (107-2Q)*Q = 107Q-2Q2

Profit = TR-TC
Profit = 107Q-2Q2-200-3Q = -2Q2+104Q-200

ii) For what values of Q does the firm break even

Firm breaks even where Profit = 0
-2Q2+104Q-200 = 0
a = -2, b=104, c=-200

iii) Illustrate the answer to (ii) using sketches of the total cost function,
the total revenue function and the profit function

Proft =
1150
 2000
TC / TR / Profit

1500

1000

500
TC

0 TR Q
0 10 20 30 40 50 60
Q = 26
Profit
Profit
-500

Note: Break even where Profit = 0 or TR=TC.

iv) From the graph estimate the maximum profit and the level of output
for which profit is maximised
Maximum profit at max point on profit curve.
Max profit = 1150 at Q = 26

3. What is the profit maximising level of output for a firm with the marginal
cost function MC = 1.6Q2-15Q+60 and a marginal revenue function MR =
280-20Q?
Profit is maximised where MR=MC
280-20Q = 1.6Q2-15Q+60
1.6Q2+5Q-220=0
a=1.6, b=5, c=-220

Profit maximising level of output is Q = 10.27 (can’t have negative output)

4. The demand function for a good is given as Q = 130-10P. Fixed costs

associated with producing that good are €60 and each unit produced costs an
extra €4.
i) Obtain an expression for total revenue and total costs in terms of Q
TR = P.Q
Q = 130-10P
10P = 130-Q
P = 13-Q/10

TR = (13-Q/10)*Q = 13Q-0.1Q2

TC = FC+VC
TC = 60+4Q

ii) For what values of Q does the firm break even

Firm breaks even where TR = TC
13Q-0.1Q2=60+4Q
-0.1Q2+9Q-60=0
a=-0.1, b=9, c=-60

iii) Obtain an expression for profit in terms of Q and sketch its graph

iv) Use the graph to confirm your answer to (ii) and to estimate
maximum profit and the level of output for which profit is maximised
Profit = TR-TC
Profit = 13Q-0.1Q2-60-4Q=-0.1Q2+9Q-60

200
Profit

150
Profit Max
Profit = 143
100

50
Profit

Q
0
0 10 20 30 40 50 60 70 80 90
Break Even Profit Max Break Even
-50 Q = 7.25 Q = 45 Q = 82.75

-100