(a)Quadratic equation and total revenue maximisation with quantity produced.
(b)Manager to choose between 2 inputs (elasticities of output for both given) to maximise ouput given predetermind budget.
Given that the managers's aim is to maximise output, subject to the constraint in the form of the total budget to be spent on two inputs, what quantities of X1 and X2 should be purchased?
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Quantitative Methods 2
1(b) The Manager of a firm believes that the Total Revenue curve for her product varies with the quantity produced (which we will take to be quantity sold) such that it is a concave equation and that Total Revenue is zero when the quantity is 0 and also when the quantity produced is 51. At what quantity produced will Total Revenue be maximized? Explain your reasonings
Let TR = ax^2 + bx +c
Given TR = 0 at x = 0 , so that ...
The quantity produced will Total Revenue be maximized is computed. The total budget to be spent on two inputs is found.