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Profit Maximization

The cost to produce each of two products is dependent on the quanity in order to maximize profits.

product a sells for $10,000 a unit and product 2 sells for $12,000 a unit. Fixed cost is $2,000 for each product find the optimal points.

c1=x1+x2(in thousands of dollars)
c2=2x2+x1(in thousands of dollars)

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For profit maximization marginal cost must equal marginal revenue. It is very clear that marginal revenue for ...

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