8. Firm's RevenueA firm in a competitive market receives $1,080 in total revenue and has marginal revenue of $20.The firm's average revenue is Sunits were sold.

The firm's average revenue is $20, and 54 units were sold. Explanation:To find the average revenue,…

Answered: 8. Firm's Revenue A firm in a…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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24. The figure to the right illustrates the cost curves of a perfectly competitive firm. If the market price is P1 Price and cost (dollars per pound) ATC AVC 0 D-MR 0₁ 02 03 A. The firm will experience a loss since price is less than ATC. B. The firm will break even by producing a quantity of Q2. C. The firm may make a profit if it can increase the demand for its product. D. The firm will experience a loss and raise its price to P2. The firm will then break even. Quantity (thousands of pounds) 1
3
3. The components of marginal revenue Alex's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Alex produced eight fire engines, but he has decided to increase production to nine fire engines. The following graph shows the demand curve Alex faces. As you can see, to sell the additional engine, Alex must lower his price from $80,000 to $40,000 per fire engine. Note that while Alex gains revenue from the additional engine he sells, he also loses revenue from the initial eight engines because he sells them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial eight engines by selling at $40,000 rather than $80,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $40,000. dollars per fire engine) PRICE (Thousands Alex 200 180 160 140 120 100 80 60 40 20 0 0 + 1 True + False 2 + 4…
3. The components of marginal revenue Bob's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Bob produced five fire engines, but he has decided to increase production to six fire engines. The following graph shows the demand curve Bob faces. As you can see, to sell the additional engine, Bob must lower his price from $160,000 to $120,000 per fire engine. Note that while Bob gains revenue from the additional engine he sells, he also loses revenue from the initial five engines because he sells them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial five engines by selling at $120,000 rather than $160,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $120,000. PRICE (Thousands of dollars per fire engine) 200 180 160 140 120 100 80 60 40 20 0 + 0 1 2 Bob in this scenario.…
Is the firm making an economic profit or loss? Will firms enter or exit this market? 3. Sketch on the graph and explain what happens to bring this market to long run equilibrium.
29. In the long run, a profit maximizing firm will choose to exit a market when a. fixei costs exceed total costs O totai revenue from production is less than total costs c average fixed cost is rising d. marginal cost exceeds marginal revenue at the current level of production
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Figure 14-2 Suppose a firm operating in a competitive market has the following cost curves: 20 MC 18 16 14 12 ATC 10 8 7 4 1 3 4 5 6 7 8 9 10 QUANTITY Refer to Figure 14-2. If the market price is $10, what is the firm's total revenue? a. $35 b. $30 C. $15 d. $50 PRICE
4. The graph shows the perfect competition market. Price per unit MC ATC $3.00 MR 2.00 1.90 1.00 100 250 300 400 Output per day a. The exhibit shows a perfectly competitive firm that faces demand curve d, has the cost curves shown, and maximizes profit. The firm will produce output per day. units of b. The exhibit shows a perfectly competitive firm that faces demand curve d, has the cost curves shown, and maximizes profit. The firm's total revenue per day is: c. The exhibit shows a perfectly competitive firm that faces demand curve d, has the cost curves shown, and maximizes profit. The firm's total cost per day is: d. The exhibit shows a perfectly competitive firm that faces demand curve d, has the cost curves shown, and maximizes profit. The firm's total profit per day is:
The table below shows cost and revenue information for Choco Lovers, a perfectly competitive firm producing different quantities of chocolate gift boxes. Fill in the blanks in the table. Instructions: Round your answers to 2 decimal places. Choco Lovers Costs and Revenue Quantity TC ATC MC of Gift Boxes ($) ($) ($) 5 55.00 11.00 1.00 10 57.50 5.75 15 4.1667 1.00 20 72.50 2.00 25 92.50 3.70 4.00 30 122.50 40.833 6.00 Instructions: Enter your answers below as whole numbers. For profit and profit per unit, round your answers to 2 decimal places. Include a negative sign if necessary. 4 Profit-maximizing price Profit-maximizing quantity = Total revenue = Profit = %3D Profit per unit = 12 Next > %24 %24 %24
2. The demand curve facing a competitive firm The following graph illustrates the market for small moving trucks in Waco, TX, during Baylor's fall move-in week. PRICE (Dollars per small truck) 100 90 80 70 60 50 8 40 30 20 10 0 0 0 Demand 1 1 2 3 2 3 5 6 7 QUANTITY (Hundreds of small trucks) Suppose that You Yeet is one of over a dozen competitive firms in the Waco area that offers moving truck rentals. Based on the preceding graph showing the weekly market demand and supply curves, the price YouYeet must take as given is $ Fill in the price and the total, marginal, and average revenue YouYeet earns when it rents 0, 1, 2, or 3 trucks during move-in week. Quantity Price Total Revenue Marginal Revenue Average Revenue (Dollars) (Dollars) (Dollars per truck) (Trucks) (Dollars per truck) Supply curve Supply 9 Average revenue curve Marginal cost curve 10 0 Marginal revenue curve The demand curve faced by YouYeet is identical to which of its other curves? Check all that apply.
3. The components of marginal revenue Jabar's HookNLadder is the only company selling fire engines in the fictional country of Alexandrina. Jabari initially produced five trucks, but then decided to increase production to six trucks. The following graph gives the demand curve faced by Jabari's HookNLadder. As the graph shows, in order to sell the additional fire truck, Jabari must lower the price from $160,000 to $120,000 per truck. Notice that Jabari gains revenue from the sale of the additional engine, but at the same time, he loses revenue from the initial five engines because they are all sold at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial five engines by selling at $120,000 rather than $160,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $120,000. PRICE (Thousands of dollars per fire engine) 200 100 100 140 120…

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8. Firm's Revenue A firm in a competitive market receives $1,080 in total revenue and has marginal revenue of $20. The firm's average revenue is S units were sold.