b) Suppose the demand function for producing a laptop is P = 200 - 0.4q. The fixed cost is 900 and it costs RM100 to produce each laptop. P is price in Ringgit and q is number of products. i. Determine the marginal revenue function. How much is marginal revenue when q=5. Interpret the result? ii. Determine the number of products that will maximise the profit. iii. Determine the point elasticity of demand when q=5.
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Marginal revenue function: To find the marginal revenue function, we need to take the derivative of the demand function with respect to q: dP/dq = 200*0.4 = 80 So, the marginal revenue function is MR = 80q. Show more…
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