Asked by Ed
Applacian Coal Mine Co believes it can increase labor productivity and therefore, net revenue by reducing air pollution in its mines. It is estimated that the marginal cost for reducing pollution by installing additional capital equipment is MC = 40P....where P represents a reduction of one unit of pollution in the coal mines, the comapny feels that for every unit of pollution reduction the marginal increase in revenue (MR) is: MR=1,000 - 10P. How much pollution reduction should the coal mine company undertake?
Use algebra. Set MC=MR, then solve for P.
Use algebra. Set MC=MR, then solve for P.
Answers
Answered by
Anonymous
1000-10P=40P
1000=50P
P=20
1000=50P
P=20
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