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    A firm’s total profit equation is : π(X,Y)=-900+360X-X^2-XY-Y^2+250Y Where X and Y represent the output...

    A firm’s total profit equation is :
π(X,Y)=-900+360X-X^2-XY-Y^2+250Y
Where X and Y represent the output levels for the two product lines.

   Using Lagrange multiplier method, determine the profit-maximizing output levels of goods X and Y given that the sum of the two product lines equal 500 units.   [10 marks]
   Calculate the firm’s total profits.                       [2 marks]
   What is the interpretation of the Lagrange multiplier?           [3 marks]

    A firm’s total profit equation is :
π(X,Y)=-900+360X-X^2-XY-Y^2+250Y
Where X and Y represent the output levels for the two product lines.

    Using Lagrange multiplier method, determine the profit-maximizing output levels of goods X and Y given that the sum of the two product lines equal 500 units.    [10 marks]
    Calculate the firm’s total profits.                        [2 marks]
    What is the interpretation of the Lagrange multiplier?            [3 marks]

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