Problem
1. Suppose a firm faces the inverse demand curve P = 600Q-?0.5 . The firm has the total cost curve TC = 1,000 + 0.5Q1.5. Find the firm's profitmaximizing output, price, and profit.
2. Consider a firm in a perfectly competitive market with total costs given by
TC = Q3 - 15 Q2 + 100Q + 30
a. What is this firm's marginal cost function? Over what range of output are the firm's marginal costs decreasing? Increasing?
b. Suppose that the market price is $52. What is this firm's profit-maximizing level of output? How do you know this is the profit-maximizing output? How much profit does this firm earn by producing the profit-maximizing output?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.