According to this graph, what is the profit-maximizing quantity for this firm? Price (S) MC1 27 24 ATC1 21 18 AVC1 15 12 3 MR D 10 20 30 40 50 60 70 80 90 Quantity Select one: а. 68 b. 50 С. 30 d. 0
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- The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Buddies, a purely competitive firm that produces novelty ear buds. Assume the market for novelty ear buds is a competitive market and that the price of ear buds is $6.00 per pair. Buddies Production Costs Quantity MC ATC of Ear Buds ($) ($) 20 1.00 25 2.00 1.20 30 2.46 1.41 35 3.51 1.71 40 4.11 2.01 45 5.43 2.39 50 5.99 2.75 55 8.47 3.27 Instructions: In part a, enter your answer as the closest given whole number. In parts b-d, round your answers to two decimal places. a. If Buddies wants to maximize profits, how many pairs of ear buds should it produce each week? pairs b. At the profit-maximizing quantity, what is the total cost of producing ear buds? 2$ c. If the market price for ear buds is $6 per pair, and Buddies produces the profit-maximizing quantity of ear buds, what will Buddies profit or loss be per week? 2$Omari's HookNLadder is the only company selling fire engines in the fictional country of Alexandrina. Omari initially produced four trucks, but then decided to increase production to five trucks. The following graph gives the demand curve faced by Omari's HookNLadder. As the graph shows, in order to sell the additional fire truck, Omari must lower the price from $105,000 to $90,000 per truck. Notice that Omari gains revenue from the sale of the additional engine, but at the same time, he loses revenue from the initial four 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 four engines by selling at $90,000 rather than $105,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $90,000. PRICE (Thousands of dollars per fire engine) 165 150 135 120 105 Omari 90 75 60 45 30 15 Revenue Lost Demand…Paulina sells beef in a competitive market where the price is $8 per pound. Her total revenue and total costs are given in the table below. Quantity of Total revenue Total cost beef (lb.) 0 1 2 3 4 ($) 0 8 16 24 32 ($) 4 8 13 19 27 Profit ($) 0 8 pounds Marginal revenue ($) c. What is the profit-maximizing (or loss-minimizing) quantity? Marginal Marginal cost ($) profit ($) a. Complete the table. Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. b. At what quantity does marginal revenue equal marginal cost? pounds A
- 4. Profit maximization in the cost-curve diagram The following graph plots daily cost curves for a firm operating in the competitive market for motor scooters. Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates. PRICE (Dollars per scooter) 100 90 80 70 60 50 40 40 30 ATC 20 MC AVC 10 0 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of scooters per day) Profit or Loss ? In the short run, given a market price equal to $45 per scooter, the firm should produce a daily quantity of 45,000 scooters. On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of $45 and the quantity of production from your previous answer. Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss. The rectangular area represents a short-run of $ thousand per day for the firm.s 1, 12 & 13 Assignment Saved Help Save & Exit Assume a purely competitive increasing-cost industry is in long-run equilibrium. If a decline in demand occurs, firms will Multiple Choice leave the industry, price will fall, and quantity produced will rise. enter the industry and price and quantity will both rise. leave the industry and price and quantity will both rise. leave the industry, price will fall, and quantity produced will fall.Suppose that Redeye's Game Emporium is in a market with imperfect competition. The graph below shows the firm's demand (D), marginal revenue (MR), marginal cost (MC), and average total cost (ATC) curves. Determine the profit-maximizing level of output and the associated profit-maximizing price. Use the purple rectangle (diamond symbols) to shade the area that represents the firm's profit at this quantity. 2 2 2 2 2 2 2 2 2 2 - PRICE (Dofars per video game) 200 100 100 140 120 100 40 20 20 40 MR 1 88 60 10 100 120 140 160 180 200 QUANTITY (Thousands of Video games) D Profit Which of the following statements is correct at the point where the firm's average total cost (ATC) and the demand curve intersect?
- Answer the question based on the following graph. Costs and revenue per case 22 6432 16 $16 $12 $13 14 13 12 $14 22 24 30 38 MC MR ATC Demand What is the profit maximizing price for this firm? Quantity (cases)8. Short-run and long run effects of a shift in demand Suppose that the tuna industry is in long-run equilibrium at a price of $5 per can of tuna and a quantity of 350 million cans per year. Suppose that WebMD daims that a protein found in tuna will increase your expected lifespan by 2 years. WebMD's claim will cause consumers to demand more PRICE (Dollars per cani producing more tuna and earning positive profit Shift the demand curve, the supply curve, or both on the following graph to illustrate these short-run effects of WebMD's claim. ? 0 tuna at every price. In the short run, firms will respond by Supply Demand 70 140 210 200 350 420 400 560 630 700 QUANTITY (Millions of cans) Demand -0 SupplyPrice 2000 Multiple Choice MC P₂ ATC AVC g.opp. 9₂ Quantity Refer to the accompanying diagram. The firm will realize an economic profit if price is MP₂ MP₂ MP,
- Maria manages a bakery, that specializes in ciabatta bread, and has the following information on demand and costs: Ciabatta Bread Sold Price Per Hour (Q) (P) 0 $6.00 1 5.50 2 5.00 3 4.50 4 4.00 5 3.50 6 3.00 7 2.50 8 2.00 Total Cost (TC) $2.00 6.50 10.00 13.00 15.50 17.50 19.00 21.00 24.00 loaves of ciabatta bread per hour. (Enter your response as an integer.) a. To maximize profits, Maria should sell Maria should charge a price of $ Maria's maximum profit is $ (Enter your response rounded to two decimal places.) (Enter your response rounded to two decimal places.) (Enter your b. The marginal revenue when selling the profit-maximizing number of loaves of ciabatta bread is $ response rounded to two decimal places.) The marginal cost when selling the profit-maximizing number of loaves of ciabatta bread is $. (Enter your response rounded to two decimal places.)The following graph plots daily cost curves for a firm operating in the competitive market for fitness trackers. Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates. PRICE(Dollars pertracker) 100 90 70 60 50 40 20 10 0 0 MO ATC AVC 50 60 70 80 10 20 30 40 QUANTITY (Thousands of trackers per day) 90 100 Profit or Loss In the short run, given a market price equal to $45 per tracker, the firm should produce a daily quantity of trackers. On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of $45 and the quantity of production from your previous answer. Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss. The rectangular area represents a short-run thousand per day for the firm.3. Johnny Rockabilly has just finished recording his latest CD. His record company's marketing department determines that the demand for the CD is as follows: Price Number of CDs $24 10 000 22 20 000 20 20 30 000 18 40 000 16 50 000 14 60 000 The company can produce the CD with no fixed cost and a variable cost of $5 per CD. a. Find total revenue for quantity equal to 10 000, 20 000, and so on. What is the marginal revenue for each 10 000 increase in the quantity sold? b. What quantity of CDs would maximize profit? What would be the price? What would be the profit? c. If you were Johnny's agent, what recording fee would you advise Johnny to demand from the record company? Why?