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Dunk?Ya Donuts has a monopoly in the town

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4. (a) Dunk?Ya Donuts has a monopoly in the town of Catchem. Its production function is Q = 30L, where L is the amount of labour it uses and Q is the number of brunch meals produced. Dunk?Ya finds that in order to hire L units of labour, it must pay a wage of 30 + 0.1L per unit of labour. The demand curve for brunch meals at Dunk?Ya Donuts is given by P = 27.67 ? 0.001Q. What is the profit-maximizing level of brunch meals for Dunk?Ya Donuts?

 

Paper#27933 | Written in 18-Jul-2015

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