Homework Help is Here – Start Your Trial Now!
Business
Economics
For a monopolist's products A and B, the joint-cost function is c(qA9B) = 2(9A + 9B +qA9B), and the demand functions are 9A=20-PA. 9B = 10 - PB. Find the values of p, and p, that maximize profit. What are the quantities of A and B that correspond to these prices? What is the total profit?

For a monopolist's products A and B, the joint-cost function is c(qA9B) = 2(9A + 9B +qA9B), and the demand functions are 9A=20-PA. 9B = 10 - PB. Find the values of p, and p, that maximize profit. What are the quantities of A and B that correspond to these prices? What is the total profit?

Microeconomic Theory
Microeconomic Theory
12th Edition
ISBN:9781337517942
Author:NICHOLSON
Publisher:NICHOLSON
Chapter2: Mathematics For Microeconomics
Section: Chapter Questions
Problem 2.11P
See similar textbooks
icon
Related questions
Question
100%

Please follow the steps of the second picture to solve the question. Again please follow the steps, thanks

1. The algorithm for local extrema of f(x,y) 1.1. 1.2. 1.3. 1.4. Calculate the first derivatives: ах' ду af Find the critical points: (xo. Yo) = 0,= (xo.Yo) = 0 a²fa²fa²f Calculate the second derivatives: дх2 дугдхду For every critical point: 1.4.1. Calculate the Hessian: H(x, y) = (x,y) x(x,y) - ( dx dy 1.4.2. If H(xo, Yo) = 0 the test is inconclusive, stop 1.4.3. If H(xo, Yo) < 0 the critical point is a saddle, stop 1.4.4. If Əx² 1.4.5. If (xo. Yo) > 0 or minimum (xo. Yo) >0 then U, the extremum is a local Əy² 8²1 -(xo. Yo) <0 or (xo. Yo) <0 then n, the extremum is a local ax² maximum
Transcribed Image Text:1. The algorithm for local extrema of f(x,y) 1.1. 1.2. 1.3. 1.4. Calculate the first derivatives: ах' ду af Find the critical points: (xo. Yo) = 0,= (xo.Yo) = 0 a²fa²fa²f Calculate the second derivatives: дх2 дугдхду For every critical point: 1.4.1. Calculate the Hessian: H(x, y) = (x,y) x(x,y) - ( dx dy 1.4.2. If H(xo, Yo) = 0 the test is inconclusive, stop 1.4.3. If H(xo, Yo) < 0 the critical point is a saddle, stop 1.4.4. If Əx² 1.4.5. If (xo. Yo) > 0 or minimum (xo. Yo) >0 then U, the extremum is a local Əy² 8²1 -(xo. Yo) <0 or (xo. Yo) <0 then n, the extremum is a local ax² maximum
For a monopolist's products A and B, the joint-cost function is c(qA9B) = 2(9A + 9B +9A + 9B), and the demand functions are 9A = 20-PA. 9B = 10 - PB. Find the values of p, and pe that maximize profit. What are the quantities of A and B that correspond to these prices? What is the total profit?
Transcribed Image Text:For a monopolist's products A and B, the joint-cost function is c(qA9B) = 2(9A + 9B +9A + 9B), and the demand functions are 9A = 20-PA. 9B = 10 - PB. Find the values of p, and pe that maximize profit. What are the quantities of A and B that correspond to these prices? What is the total profit?
Expert Solution
steps

Step by step

Solved in 4 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Lump-sum Tax
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Microeconomic Theory
Microeconomic Theory
Economics
ISBN:
9781337517942
Author:
NICHOLSON
Publisher:
Cengage
SEE MORE TEXTBOOKS