Each firm in the following table operates in a market of perfect competition and wants to maximize its profit or minimizes its loss. Case P Q TR TC TFC TVC ATC AVC MC # 1 #2 $3.00 2000 #3 2000 $8000 $2000 $5000 O increase output. decrease output, but not shut down. O shut down. What do you recommend to the firm in case #3? maintain its current rate of output $3000 $5000| $1000 $3.00 $4.00 $4.00 $3.50 $3.00 $2.50

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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Each firm in the following table operates in a market of perfect competition and wants
to maximize its profit or minimizes its loss.
Case P Q TR TC TFC TVC ATC AVC MC
# 1
#2 $3.00 2000
#3
2000 $8000 $2000
$5000
O increase output.
decrease output, but not shut down.
O shut down.
What do you recommend to the firm in case #3?
maintain its current rate of output
$3000 $5000|
$1000
$3.00 $4.00
$4.00
$3.50 $3.00 $2.50
Transcribed Image Text:Each firm in the following table operates in a market of perfect competition and wants to maximize its profit or minimizes its loss. Case P Q TR TC TFC TVC ATC AVC MC # 1 #2 $3.00 2000 #3 2000 $8000 $2000 $5000 O increase output. decrease output, but not shut down. O shut down. What do you recommend to the firm in case #3? maintain its current rate of output $3000 $5000| $1000 $3.00 $4.00 $4.00 $3.50 $3.00 $2.50
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