Originally Posted by
rodimus I'm stuck on how to set this up, and help would be great.
Demand function is Q = 16 - P
Total cost function is defined as TC = 3 + Q + 0.25 Q^2.
Use the two functions to form the firm's profit function and then determine the level of output that yields the profit maximum. What is the level of profit at the optimum?
Do I put Q in the TC function to solve?
when I do this I get:
3+(16-p)+.25(16-p)^2
19+p+.25(256-32p+p^2)
19-p+64-8p+.25p^2
83-9p+.25p^2
If this is right where do I go next?