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LL produces an item, the Z, for which the demand curve is estimated to be:P...

LL produces an item, the Z, for which the demand curve is estimated to be:

P = 10 - 0.0001Q

where, P is the unit price in $ and Q is the annual sales volume in units;

Marginal revenue (MR) = 10 - 0.0002Q

The variable cost of producing the Z is $2 per unit. The annual fixed costs of production are $110,000.

What is the profit maximizing output level?

A.

50,000 units

B.

45,000 units

C.

40,000 units

D.

35,000 units

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