Chapter Nine: Profit Maximization
Chapter 9: Profit Maximization Profit Maximization The basic assumption here is that firms are profit maximizing. Profit is defined as: Profit = Revenue – Costs Π(q) = R(q) – C(q) Π(q) =p(q)⋅q −C(q) To maximize profits, take the derivative of the profit function with respect to q and set this equal to zero. ................
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