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a market price equal to $20 per phone case. The following graph shows Jayden's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for phone cases for quantities zero through seven (including zero and seven) that Jayden produces. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 25 0 -25 0 ☐ 1 0 2 ☐ ☐ 3 4 5 QUANTITY (Phone cases) ☐ 6 Total Cost 0 7 8 Total Revenue A Profit (?)

a market price equal to $20 per phone case. The following graph shows Jayden's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for phone cases for quantities zero through seven (including zero and seven) that Jayden produces. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 25 0 -25 0 ☐ 1 0 2 ☐ ☐ 3 4 5 QUANTITY (Phone cases) ☐ 6 Total Cost 0 7 8 Total Revenue A Profit (?)

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Suppose Jayden operates a handicraft pop-up retail shop that sells phone cases. Assume a perfectly competitive market structure for phone cases with a market price equal to $20 per phone case. The following graph shows Jayden's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for phone cases for quantities zero through seven (including zero and seven) that Jayden produces. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 25 0 -25 0 1 ☐ 2 ☐ 3 4 5 QUANTITY (Phone cases) 6 Total Cost 7 8 Total Revenue Profit ?
Transcribed Image Text:Suppose Jayden operates a handicraft pop-up retail shop that sells phone cases. Assume a perfectly competitive market structure for phone cases with a market price equal to $20 per phone case. The following graph shows Jayden's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for phone cases for quantities zero through seven (including zero and seven) that Jayden produces. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 25 0 -25 0 1 ☐ 2 ☐ 3 4 5 QUANTITY (Phone cases) 6 Total Cost 7 8 Total Revenue Profit ?
Calculate Jayden's marginal revenue and marginal cost for the first seven phone cases they produce, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity. (? COSTS AND REVENUE (Dollars per phone case) 40 35 30 25 20 15 10 0 0 1 2 3 4 5 QUANTITY (Phone cases) 6 7 8 Marginal Revenue O Marginal Cost Jayden's profit is maximized when they produce a total of produce is $ an amount phone cases. At this quantity, the marginal cost of the final phone case they than the price received for each phone case they sell. At this point, the marginal cost of producing one more phone case (the first phone case beyond the profit maximizing quantity) is $ an amount than the price received for each phone case they sell. Therefore, Jayden's profit-maximizing quantity occurs at the point of intersection between the ▼curves. Because Jayden is a price taker, the previous condition is equivalent to
Transcribed Image Text:Calculate Jayden's marginal revenue and marginal cost for the first seven phone cases they produce, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity. (? COSTS AND REVENUE (Dollars per phone case) 40 35 30 25 20 15 10 0 0 1 2 3 4 5 QUANTITY (Phone cases) 6 7 8 Marginal Revenue O Marginal Cost Jayden's profit is maximized when they produce a total of produce is $ an amount phone cases. At this quantity, the marginal cost of the final phone case they than the price received for each phone case they sell. At this point, the marginal cost of producing one more phone case (the first phone case beyond the profit maximizing quantity) is $ an amount than the price received for each phone case they sell. Therefore, Jayden's profit-maximizing quantity occurs at the point of intersection between the ▼curves. Because Jayden is a price taker, the previous condition is equivalent to
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