## Exercise Instructions1. **Sketch the MC and ATC Curves** - Plot the quantity of output on the horizontal axis. - Measure costs on the vertical axis.2. **Data Table** | Quantity (Q) | Price (P) | Total Revenue (TR) | Marginal Revenue (MR) | Total Cost (TC) | Marginal Cost (MC) | Profit | |--------------|-----------|--------------------|-----------------------|----------------|-------------------|--------| | 6 | 25 | | | 126 | | | | 7 | 25 | | | 141 | | | | 8 | 25 | | | 160 | | | | 9 | 25 | | | 183 | | | | 10 | 25 | | | 210 | | | | 11 | 25 | | | 245 | | | | 12 | 25 | | | 300 | | |3. **Complete the Table** - Calculate and fill in the missing Total Revenue, Marginal Revenue, Marginal Cost, and Profit entries.4. **Profit-Maximizing Output Level** - Determine the quantity of output that maximizes profit.5. **Profit Amount at Profit-Maximizing Output Level** - Calculate the profit at the determined output level.

Since you have posted a question with multiple sub-parts, we will solve last three subparts relating to the given table. To get remaining sub-part solved please repost the question and mention the sub-parts to be solved. Marginal revenue is the addition to the total revenue from producing an additional unit of output. Marginal cost is the addition to the total cost by producing an additional unit of output. 3. Total revenue TR = P× Q Marginal revenue MR = ∆TR / ∆Q Marginal cost MC = ∆TC / ∆Q Profit = Total Revenue - Total Cost Quantity (Q) Price (P) Total Revenue (TR) Marginal Revenue (MR) Total Cost (TC) Marginal Cost(MC) Profit 6 25 150 - 126 - 24 7 25 175 25 141 15 34 8 25 200 25 160 19 40 9 25 225 25 183 23 42 10 25 250 25 210 27 40 11 25 275 25 245 35 30 12 25 300 25 300 55 0 4. The profit maximizing level of output is at the point where MR = MC. Marginal revenue equals marginal cost at the output level 9 units because MR= 25 and MC = 23. When the output is 10 units, marginal cost is higher than marginal revenue. Therefore the profit maximizing level of output is 9 units. 5. The amount of profit at profit maximizing level of output is currency 42. Profit is maximum at 9 units of output which equals 42.

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Price Total Profit Quantity (Q) Marginal Revenue Marginal Cost (TC) | Cost (MC) Total (P) Revenue (TR) (MR) 25 126 7 25 141 8 25 160 25 183 10 25 210 11 25 245 12 25 300 3. Complete the table above. 4. What is the profit-maximizing level of output? 5. What is the amount of profit at the profit maximizing output level?

Price Total Profit Quantity (Q) Marginal Revenue Marginal Cost (TC) | Cost (MC) Total (P) Revenue (TR) (MR) 25 126 7 25 141 8 25 160 25 183 10 25 210 11 25 245 12 25 300 3. Complete the table above. 4. What is the profit-maximizing level of output? 5. What is the amount of profit at the profit maximizing output level?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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