(i) Complete the Table above by filling in the blank cells. (ii) Based on the above Table, Pacesetter’s profit maximizing or loss minimizing level of output is __________; and the (profit is _________) or (loss is __________) (iii) Should the firm continue to produce in the short run? What will happen in the long-run?
(i) Complete the Table above by filling in the blank cells. (ii) Based on the above Table, Pacesetter’s profit maximizing or loss minimizing level of output is __________; and the (profit is _________) or (loss is __________) (iii) Should the firm continue to produce in the short run? What will happen in the long-run?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
PART C: MARKET ANALYSIS
- Pacesetter is a manufacturer of three-ring binders operating in a
perfectly competitive industry. The Table below shows the firm's cost and revenue schedule
Quantity (cases) |
Variable Cost |
Total Cost |
Marginal Cost |
|
|
Total Revenue |
Profit (or Loss) |
0 |
$0 |
$76 |
|
|
|
|
|
1 |
30 |
106 |
|
|
|
$40 |
|
2 |
50 |
|
|
|
|
|
|
3 |
|
134 |
|
|
|
|
|
4 |
|
140 |
|
|
|
|
|
5 |
|
160 |
|
|
|
|
|
6 |
114 |
|
|
|
|
|
|
7 |
150 |
|
|
|
|
|
|
8 |
190 |
|
|
|
|
|
|
9 |
|
316 |
|
|
|
|
|
PART C: MARKET ANALYSIS
(i)
Complete the Table above by filling in the blank cells.
(ii)
Based on the above Table, Pacesetter’s profit maximizing or loss minimizing level of output is __________;
and the (profit is _________) or (loss is __________)
(iii)
Should the firm continue to produce in the short run? What will happen in the long-run?
iv)What
v)If the firm's fixed costs were $30 higher what would be the profit-maximizing output level in the short run? Should the firm continue to operate? Why?
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