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Application of Integral Calculus

Here are the key steps to solve this problem: 1. Set the supply and demand functions equal to find the equilibrium quantity: 36 - x2 = 6 + x2/4 2. Solve for x to find the equilibrium quantity x = 6 3. Find the equilibrium price by substituting x = 6 back into the demand or supply function: p = 36 - 62 = 36 - 36 = $12 4. Calculate consumers' surplus: CS = ∫36-x26 (36 - x2) dx = 36x - x3/3 |36-62 = 216 5. Calculate producers' surplus: PS = ∫062 (6 + x2/4) dx - 6x

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Md. Arman Islam Sun 2125155660
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653 views18 pages

Application of Integral Calculus

Here are the key steps to solve this problem: 1. Set the supply and demand functions equal to find the equilibrium quantity: 36 - x2 = 6 + x2/4 2. Solve for x to find the equilibrium quantity x = 6 3. Find the equilibrium price by substituting x = 6 back into the demand or supply function: p = 36 - 62 = 36 - 36 = $12 4. Calculate consumers' surplus: CS = ∫36-x26 (36 - x2) dx = 36x - x3/3 |36-62 = 216 5. Calculate producers' surplus: PS = ∫062 (6 + x2/4) dx - 6x

Uploaded by

Md. Arman Islam Sun 2125155660
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Application of Integral Calculus

Definite Integral

 f ( x)dx  F ( x )
b
a
a

 F (b)  F ( a )
Application of Integral Calculus

Properties of Definite Integral

b b
1. 
a
f ( x ) dx   f (t ) dt
a
a
2. 
a
f ( x ) dx 0

b a
3. 
a
f ( x ) dx    f ( x ) dx
b
Application of Integral Calculus

Properties of Definite Integral

c b c
4.  f ( x)dx   f ( x)dx   f ( x)dx
a a b
a a
5.  f ( x)dx  2  f ( x)dx
a 0
Application of Integral Calculus
1

  x ) dx
2 3
( 2 x
1
4

  x ) dx
2 3
(3 x
2
10
dx

6
x2
Application of Integral Calculus

2
t  2t  5
2

1 t
dt
Application of Integral Calculus

d(TC)
We know, MC 
dx
 TC   ( MC ) dx
d(TR)
And , MR 
dx
 TR   ( MR ) dx
Application of Integral Calculus

The marginal cost function of a product is


given by: MC = 100 – 10x + 0.1x2,
where x is the output. Obtain the total and
the average cost function of the firm if the
fixed cost is $500.
Application of Integral Calculus

The marginal cost function of manufacturing


x shoes is 6+10x-6x2. The total cost for
producing a pair of shoes is $12. Find the
total and average cost function.
Application of Integral Calculus

Ex. 74 (ACE 93)


The marginal revenue function for output is given by
6
Rm  5
( x  2) 2

, find the total revenue function and demand


function.
Application of Integral Calculus

The ABC Company Ltd. Has approximated the marginal


revenue function for one of its products by MR = 20x – 2x2.
The marginal cost function is approximated by MC = 81 –
16x + x2. Determine the profit maximizing output, the total
profit, the total revenue function, and demand function.
Application of Integral Calculus

• Consumer Surplus: The


amount a buyer is willing
to pay for a good minus
the amount the buyer
actually pays for it.

D
Application of Integral Calculus
Pmax S

Consumer
Surplus
PE

QE
Application of Integral Calculus

Consumers’ Surplus

xe

 
0
D ( x )dx  xe p e
Application of Integral Calculus

• Producer Surplus: The S

amount a seller is paid


minus the cost of
production.
• Producer surplus
measures the benefit to
sellers of participating in
a market.
Application of Integral Calculus

PE
Producer
Surplus

QE
Application of Integral Calculus

Producer’s Surplus

xe

 xe pe  
0
S ( x )dx
Application of Integral Calculus

The supply and demand functions for SAE 90


lubricating oil are p = 10 + 0.5q and p = 110 –
0.5q respectively. Find the producers’ and
consumers’ surplus.
Application of Integral Calculus

Ex.84
Find the producers’ and consumers’ surplus
under pure competition for the demand
function p = 36 – x2 and supply function
p = 6 + x2/4, where p is the price and x is
quantity.

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