Draw the firm's demand curve. Label it D. Draw the firm's marginal revenue curve. Label it MR. Draw the firm's marginal cost curve. Label it MC. Draw a point at the profit-maximizing price and output. Wilbur's economic profit is $ a day.

Draw the firm's demand curve. Label it D. Draw the firm's marginal revenue curve. Label it MR. Draw the firm's marginal cost curve. Label it MC. Draw a point at the profit-maximizing price and output. Wilbur's economic profit is $ a day.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Wilbur's is the only septic service in a remote village. The firm's total fixed cost is $150 a day and marginal cost is
zero. The table gives the demand schedule for service calls.
Price
(dollars per service call)
500
400
300
200
100
0
Draw the firm's demand curve. Label it D.
Draw the firm's marginal revenue curve. Label it MR.
Quantity
(service calls per day)
0
2
4
6
8
10
Draw the firm's marginal cost curve. Label it MC.
Draw a point at the profit-maximizing price and output.
Wilbur's economic profit is $ a day.
>>> If the firm incurs an economic loss, indicate the loss with a minus sign. If the firm earns an economic profit, do
not include a plus sign.
600
500-
400-
300-
200-
100-
04
Price and cost (dollars per service call)
4
10
Quantity (service calls per day)
>>> Draw only the objects specified in the question
0
12

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Step 2: 1. Demand Curve

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Step 3: 2. Marginal revenue curve

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Step 4: 3. Marginal cost curve

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