Question: To manufacture a product, the fixed costs are $1,000 per month and the variable costs are $70 per item. The selling price varies according to the formula:

p=270-2q is the quantity sold

i. Obtain the total cost equation and the revenue equation (2 marks)

ii. Obtain the marginal revenue equation (2 marks)

iii. Obtain the marginal cost equation (2 marks)

iv. Hence, determine the maximum level of profit and the level of quantity that will yield the maximum profit. (2 marks)

v. Obtain the profit equation (2 marks)

vi. Calculate the maximum profit (2 marks)