Need help with managerial economics homework?

Posted on 2014-04-15 11:18:00 in Economics by ?

The problem is:



The production manager of a clothing manufacturer estimates that the daily total cost of producing men's suits is given by the equation: C = 2,000 + 396 Q - 0.8Q². The market price of suits is $300. Should the firm shut down? Explain.



I'm not really sure if I started this right, but here is what I have so far:



TVC = 2,000 + 396 Q - 0.8Q²



AVC = 396 - 0.8Q



MC = 396 - 1.6Q



300 = 396 - 1.6Q



Q = 60



If someone could explain how you're suppose to solve this problem I would really appreciate it. Thanks.

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