Suppose a firm’s costs are F + v ˆ— q2 where F and v are positive real

Suppose a firm’s costs are F + v ˆ— q2 where F and v are positive real numbers and the firm sells its product at the market determined price p. Profits are calculated using

A) p ˆ— q – F – v ˆ— q2.
B) [p -(F/q + v ˆ— q)] ˆ— q.
C) [(p ˆ— q)/q -(F + v ˆ— q)/q] ˆ— q.
D) Both A and B.

 

ANSWER

D

 

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