Mr.O.Carr has the cost function c(y)  y2  144 if his output, y, is positive and c(0)  0.If the price of output is 18, Mr.Carr's profit-maximizing output is zero.

Question

Mr.O.Carr has the cost function c(y)   y2    144 if his output, y, is positive and c(0)   0.If the price of output is 18, Mr.Carr's profit-maximizing output is zero.

Millionaires World · Accepted Answer

Final Answer : False, Explanation :  The given cost function seems to be incorrectly formatted, making it difficult to interpret. However, if the price of output is 18 and assuming the cost function increases with output, there exists a possibility that Mr. Carr could produce at a level where marginal cost equals marginal revenue (price of output) to maximize profit, which could be greater than zero. Without a clear, correctly formatted cost function, we cannot definitively say his profit-maximizing output is zero.

Mr.O.Carr has the cost function c(y) y2  144 if his output, y, is positive and c(0) 0.If the price of output is 18, Mr.Carr's profit-maximizing output is zero.

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