1. Followings are the revenue and cost function of a company. Find the profit maximizing output.

R ( Q )=1000 Q−2 Q 2

C ( Q ) =Q 3−59 Q 2+1315 Q+2000

2. A ceramic manufacturer produces q sets per month at a total cost of BDT q 2+78 q+2500. He is a
monopolists and the demand function for his product is 8 q=600−p when the price is BDT p
per set. Show the profit maximizing output and price.

3. Find the revenue maximizing and cost minimizing output from the following revenue and cost
functions where q represents the output.

R( q)=21 q−q2
1
C ( q )= q 3−3 q 2−7 q+ 16
3

25−2 p
4. For a particular product the demand function is Q= where Q is the quantity demanded
3
and p is the price. Moreover, average cost per unit is BDT 40. Find the following
i. Revenue function
ii. Cost function
iii. Profit function
iv. Profit maximizing price
v. Maximum profit

5. Continental is planning to inaugurate a new model of its product tyres. Rather than setting the
price of the product based only on the production cost estimates, management polls the seller of
the tyre to see how many tyres they would buy for various prices. From this survey it is
determined that the unit demand function is x +1500 p=30,000 where x represents the units of
tyre and p is the price. Fixed cost to the company for producing the tyres is $28,000 and the cost
of materials and labor for each tyre is estimated to be $8.00 per unit. What price should the
company charge in order to maximize profit?

6. The product function of a commodity is given by

2 I3
O=40 I +3 I −
3
Where, O is the output and I is the input. Determine
i. The number of units of input required to give maximum output
ii. Maximum value of marginal product
iii. Verify that when average product is maximum it is equal to marginal product.

x3 2
7. Total cost function of a firm is TC= −5 x + 28 x +10 ,where x represents the units. A tax at
3
the rate of BDT 2 per unit of output is imposed and producer adds this to the cost. If the market
 demand function is given by p=2530−5 x , where p is the price per unit. Find the profit
maximizing output and price.

8. An employee’s monthly productivity M, in number of units produced, is found to be a function of

t, the number of years of service. For a certain product, a productivity function is given by

M (t )=−2t 2+ 100t +180 , 0 ≤t ≤ 40

Find the maximum productivity and the year in which it is achieved.

9. Sound Software estimates that it will sell N units of a program after spending a dollars on
advertising, where
N ( a )=−a2 +300 a+6 , 0 ≤ a ≤300

and a is in thousands of dollars. Find the maximum number of units that can be sold and the
amount that must be spent on advertising in order to achieve that maximum.

10. The percentage of the U.S. national income generated by nonfarm proprietors may be modeled by

13 x3 −240 x2 −2460 x +585,000

p ( n )=
75,000

Where x is the number of years since 1970. According to this model, in what year from 1970
through 2000 was this percentage a minimum?

11. Corner Stone Electronics determines that its total weekly profit, in dollars, from the production
and sale of x amplifiers is given by

1500
p ( x) = 2
x −6 x +10

Find the number of amplifiers, x, for which the total weekly profit is a maximum.

12. A stereo manufacturer determines that in order to sell x units of a new stereo, the price per unit, in
dollars, must be
p ( x ) =1000−x
The manufacturer also determines that the total cost of producing x units is given by

c ( x ) =3000+20 x .
a) Find the total revenue.
b) Find the total profit.
c) How many units must the company produce and sell in order to maximize profit?
d) What is the maximum profit?
e) What price per unit must be charged in order to make this maximum profit?