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Apila Homework: Perfect Competition Suppose Clancy runs a small business that manufactures teddy bears. Assume that the market for teddy bears is a competitive market, and the market price is $20 per teddy bear. The following graph shows Clancy's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven teddy bears that Clancy produces, including zero teddy bears. TOTAL COST AND REVENUE (Dollars) 200 175 Total Revenue 125 Total Cost Profit 100 150 75 50 25 ༞་ ིི་རྩ་གླ་ ྴ་གླུ་ 0 -25 0 1 2 3 5 QUANTITY (Teddy bears) 6 7 (?) Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. (?) Aplia Homework: Perfect Competition Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. COSTS AND REVENUE (Dollars per teddy bear) 40 35 30 25 20 15 10 QUANTITY (Teddy be 4 QUANTITY (Teddy hears) 6 Marginal Revenue Marginal Cost Clancy's profit is maximized when he produces $which is teddy bears. When he does this, the marginal cost of the last teddy bear he produces is than the price Clancy receives for each teddy bear he sells. The marginal cost of producing an additional teddy bear (that is, one more teddy bear than would maximize his profit) is $ , which is than the price Clancy receives for each teddy bear he sells. Therefore, Clancy's profit-maximizing quantity corresponds to the intersection of the - .. curves. Because Clancy is a price taker, this last condition can also be written as Grade It Now Save & Continue Continue without saving

Apila Homework: Perfect Competition Suppose Clancy runs a small business that manufactures teddy bears. Assume that the market for teddy bears is a competitive market, and the market price is $20 per teddy bear. The following graph shows Clancy's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven teddy bears that Clancy produces, including zero teddy bears. TOTAL COST AND REVENUE (Dollars) 200 175 Total Revenue 125 Total Cost Profit 100 150 75 50 25 ༞་ ིི་རྩ་གླ་ ྴ་གླུ་ 0 -25 0 1 2 3 5 QUANTITY (Teddy bears) 6 7 (?) Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. (?) Aplia Homework: Perfect Competition Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. COSTS AND REVENUE (Dollars per teddy bear) 40 35 30 25 20 15 10 QUANTITY (Teddy be 4 QUANTITY (Teddy hears) 6 Marginal Revenue Marginal Cost Clancy's profit is maximized when he produces $which is teddy bears. When he does this, the marginal cost of the last teddy bear he produces is than the price Clancy receives for each teddy bear he sells. The marginal cost of producing an additional teddy bear (that is, one more teddy bear than would maximize his profit) is $ , which is than the price Clancy receives for each teddy bear he sells. Therefore, Clancy's profit-maximizing quantity corresponds to the intersection of the - .. curves. Because Clancy is a price taker, this last condition can also be written as Grade It Now Save & Continue Continue without saving

Economics:
Economics:
10th Edition
ISBN:9781285859460
Author:BOYES, William
Publisher:BOYES, William
Chapter23: Profit Maximization
Section: Chapter Questions
Problem 1E
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Apila Homework: Perfect Competition Suppose Clancy runs a small business that manufactures teddy bears. Assume that the market for teddy bears is a competitive market, and the market price is $20 per teddy bear. The following graph shows Clancy's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven teddy bears that Clancy produces, including zero teddy bears. TOTAL COST AND REVENUE (Dollars) 200 175 Total Revenue 125 Total Cost Profit 100 150 75 50 25 ༞་ ིི་རྩ་གླ་ ྴ་གླུ་ 0 -25 0 1 2 3 5 QUANTITY (Teddy bears) 6 7 (?) Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. (?)
Transcribed Image Text:Apila Homework: Perfect Competition Suppose Clancy runs a small business that manufactures teddy bears. Assume that the market for teddy bears is a competitive market, and the market price is $20 per teddy bear. The following graph shows Clancy's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven teddy bears that Clancy produces, including zero teddy bears. TOTAL COST AND REVENUE (Dollars) 200 175 Total Revenue 125 Total Cost Profit 100 150 75 50 25 ༞་ ིི་རྩ་གླ་ ྴ་གླུ་ 0 -25 0 1 2 3 5 QUANTITY (Teddy bears) 6 7 (?) Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. (?)
Aplia Homework: Perfect Competition Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. COSTS AND REVENUE (Dollars per teddy bear) 40 35 30 25 20 15 10 QUANTITY (Teddy be 4 QUANTITY (Teddy hears) 6 Marginal Revenue Marginal Cost Clancy's profit is maximized when he produces $which is teddy bears. When he does this, the marginal cost of the last teddy bear he produces is than the price Clancy receives for each teddy bear he sells. The marginal cost of producing an additional teddy bear (that is, one more teddy bear than would maximize his profit) is $ , which is than the price Clancy receives for each teddy bear he sells. Therefore, Clancy's profit-maximizing quantity corresponds to the intersection of the - .. curves. Because Clancy is a price taker, this last condition can also be written as Grade It Now Save & Continue Continue without saving
Transcribed Image Text:Aplia Homework: Perfect Competition Calculate Clancy's marginal revenue and marginal cost for the first seven teddy bears he produces, 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. COSTS AND REVENUE (Dollars per teddy bear) 40 35 30 25 20 15 10 QUANTITY (Teddy be 4 QUANTITY (Teddy hears) 6 Marginal Revenue Marginal Cost Clancy's profit is maximized when he produces $which is teddy bears. When he does this, the marginal cost of the last teddy bear he produces is than the price Clancy receives for each teddy bear he sells. The marginal cost of producing an additional teddy bear (that is, one more teddy bear than would maximize his profit) is $ , which is than the price Clancy receives for each teddy bear he sells. Therefore, Clancy's profit-maximizing quantity corresponds to the intersection of the - .. curves. Because Clancy is a price taker, this last condition can also be written as Grade It Now Save & Continue Continue without saving
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