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Suppose a firm sells a good q and the production function of good q is
16q = 65 – 2(x – 5)2 – 4(y – 4)2
the price unit of the good q is 32 and the unit prices of inputs x and y are 8 and 4 , respectively. 4.1. Derive the total revenue function of this firm (2 points) 4.2. Derive the profit function of this firm ( 2 points) 4.3. Find quantity of inputs x and y that maximize profit 4.4. Test the second order conditions of the profit maximization
What is the maximum profit?
What is the output level, q, at the maximum profit?
