Please double check your answer. I will greatly apreciate it. For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at thatquantity, using the data from the graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down,it will produce. (Hint: You can select the purple points [diamond symbols] on the graph to see precise information on average variable cost.)PriceQuantityTotal RevenueFixed CostVariable CostProfit(Dollars per polo)(Polos)(Dollars)(Dollars)(Dollars)(Dollars)12.50135,00027.50135,00045.00135,000If the firm shuts down, it must incur its fixed costs (FC) in the short run. In this case, the firm's fixed cost is $135,000 per day. In other words, if itshuts down, the firm would suffer losses of $135,000 per day until its fixed costs end (such as the expiration of a building lease).This firm's shutdown price-that is, the price below which it is optimal for the firm to shut down-isper polo. 5. Profit maximization and shutting down in the short runSuppose that the market for polos is a competitive market. The following graph shows the daily cost curves of a firm operating in this market.5045403530ATC252015AVC10MC+248101214161820QUANTITY (Thousands of polos)PRICE (Dollars per polo)

Perfect competition is a market structure in which there are many buyers and sellers, and no single…

For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that quantity, using the data from the graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down, it will produce. (Hint: You can select the purple points [diamond symbols] on the graph to see precise information on average variable cost.)

For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that quantity, using the data from the graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down, it will produce. (Hint: You can select the purple points [diamond symbols] on the graph to see precise information on average variable cost.)

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

Please double check your answer. I will greatly apreciate it.

For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that
quantity, using the data from the graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down,
it will produce. (Hint: You can select the purple points [diamond symbols] on the graph to see precise information on average variable cost.)
Price
Quantity
Total Revenue
Fixed Cost
Variable Cost
Profit
(Dollars per polo)
(Polos)
(Dollars)
(Dollars)
(Dollars)
(Dollars)
12.50
135,000
27.50
135,000
45.00
135,000
If the firm shuts down, it must incur its fixed costs (FC) in the short run. In this case, the firm's fixed cost is $135,000 per day. In other words, if it
shuts down, the firm would suffer losses of $135,000 per day until its fixed costs end (such as the expiration of a building lease).
This firm's shutdown price-that is, the price below which it is optimal for the firm to shut down-is
per polo.

5. Profit maximization and shutting down in the short run
Suppose that the market for polos is a competitive market. The following graph shows the daily cost curves of a firm operating in this market.
50
45
40
35
30
ATC
25
20
15
AVC
10
MC
+
2
4
8
10
12
14
16
18
20
QUANTITY (Thousands of polos)
PRICE (Dollars per polo)

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