Explore BrainMass
Share

Explore BrainMass

    Calculating output level of second plant

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    A firm has two plants with the following marginal cost functions: MC1 = 20 +2Q1, MC2 = 10 +5Q2
    Where MC1 is marginal cost in the first plant, MC2 is marginal cost in the second plant, Q1 is output in the first plant and Q2 is output in the second plant.

    a.If the firm is minimizing its cost and if it is producing 5 units of output in the first plant, how many units of output is it producing in the second plant?

    b.Explain

    © BrainMass Inc. brainmass.com October 10, 2019, 3:03 am ad1c9bdddf
    https://brainmass.com/economics/price-levels/calculating-output-level-of-second-plant-405493

    Solution Preview

    a.If the firm is minimizing its cost and if it is producing 5 units of output in the first plant, how many units of output is it producing in the second plant?

    MC1=20+2Q1=20+2*5=30

    Put ...

    Solution Summary

    Solution describes the steps to calculate output level of the second plant.

    $2.19