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You are manager of College Computers,




16 You are manager of College Computers, a manufacturer of customized computers that meet the specifications required by the local university. Over 90 percent of your clientele consists of college students. College Computers is not the only firm that builds computers to meet this university?s specifications;indeed, it competes with many manufacturers online and through traditional retail outlets. To attract its large students clientele, college Computers runs a weekly ad in the student paper advertising it ?free service after the sale? policy in an attempt to differentiate it self from the competition. The weekly demand for computers produced by College Computers is given by Q = 1,000 ? P, and its weekly cost of producing computers C(Q) = 2000 + Q2. If other firms in the industry sell PC?s at $600, what price and quantity of computers should you produce to maximize your firm?s profits? What long-run adjustments should you anticipate? Explain.


Paper#26950 | Written in 18-Jul-2015

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