I'm in Managerial economics and I am totoally confused. Here is the problem;A coal mining company believes it can increase labor productivity and increase revenue by reducing air pollution. It estimates the marginal cost function for reducing air pollution by installing aditional capitol equipment is;MC=40P;wher P represents a reduction of one unit of pollution in the mines. It also feels that for every unit of pollution reduction the marginal increase in revenue (MR) is MR=1,000-10P;How much pollution reduction should the coal mining company undertake?;I am hoping you can explain this in a way that makes sense to me as I am a bit baffled. Thanks!
Paper#21342 | Written in 18-Jul-2015Price : $27