please i need an answer for the parts : a,b,c,d thank you has estimated its dema

Question

please i need an answer for the parts : a,b,c,d
thank you

has estimated its demand and cost functions to be as follows: P-60-0.20 C = 200 + 4Q + 1.20° where Q is in units, P is in $ and C is in s a. Calculate the profit maximizing price and output b. Calculate the size of the profit c. Calculate the price elasticity of demand at the above price. d. If there is a $14 tax placed on the good, so that the producer has to pay the government $14 for every unit sold, calculate the new profit- maximizing price and output. e. What would happen to profit if the firm tried to pass on all the tax to the consumer in the form of a higher price? f. If fixed costs rise by $200 how would this affect the firm's situation?

Explanation / Answer

P= 60-0.2Q & C= 200+4Q+1.2Q^2

If we consider it as Monopoly Market

MR = MC

60-0.4Q = 4+2.4Q

Q = 20; P =50

60-0.2Q=4+2.4Q; 56 = 2.6Q; Q = 21.5=21 & P = 55.8

Answer for B)

Size of Profit when Monopoly is considered

Profit =TR-TC = 50*20-200-4*20-1.2*20^2= 720-480 =240

Answer for C)

Q0 = 20 ; P0 =50 if Q1=15 ; P1=57

e = (Q1-Q0)(P1-P0)/(Q1+Q0)(P1+P0)=(-5)(7)/(35)(107)= -1/107=-0.01

Answer for D)

Profit = PQ- (C)+14Q =(P+14)Q-C=(74-0.2Q)*Q-200-4Q-1.2Q^2 =74Q-0.2Q^2-200-4Q-1.2Q^2=70Q-1.4Q^2-200

70-2.8Q=0 then Q =25

And Price = 55

Finding FOC we get

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