dcg）-20g d№ Similarly,the marginal cost in Factory 2 is dC.(C)0 do Rearranging the marginal cost equations in inverse form and horizontally summing them,we obtain total marginal cost.MC: Q-Q+Q.-MC MC.-3MC 40 40 L,or 20 C: Profit maximization occurs where MCT=MR.See Figure 10.8.a for the profit-maximizing output for each factory,total output,and price. Price 800 700 MC:MCMC 600 60 400 300 200 MR 100 0201T 70 140 Quantity Figure 10.8.a b.Calculate the values ofQ,Q,Q,and P that maximize profit. Calculate the total output that maximizes profit,ie.Q such that MCr= MR: 402=700-10Q.0rQ=30 dC1(Q1) dQ = 20Q1 . Similarly, the marginal cost in Factory 2 is dC2 (Q2) dQ = 40Q2 . Rearranging the marginal cost equations in inverse form and horizontally summing them, we obtain total marginal cost, MCT: Q Q Q MC MC MCT = + = + = 1 2 1 2 20 40 3 40 , or MC Q T = 40 3 . Profit maximization occurs where MCT = MR. See Figure 10.8.a for the profit-maximizing output for each factory, total output, and price. Quantity 100 200 300 400 500 600 70 140 700 Price 800 PM MCT QT MC2 MC1 Q2 Q1 MR D Figure 10.8.a b. Calculate the values of Q1 , Q2 , Q, and P that maximize profit. Calculate the total output that maximizes profit, i.e., Q such that MCT = MR: 40 3 700 10 Q = − Q , or Q = 30