PS4.2(a)What Optimal Level of Output (q*) will a Firm Produce given thefollowing?MC(q) = 3 + 2qPrice (P) = $9MC → Marginal Costq→ Quantity(b) What is a Firm's Producer Surplus assuming the following?Area of Triangle = 1/2* Base * Height(c) Will a Firm be Earning a Positive, Negative, or Zero Profit in theShort-Run given the following?AVC (q) =3+qFC = $3AVC → Average Variable CostFC Fixed Cost

Answered: PS4.2 (a) What Optimal Level of Output…

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

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PS4.2
(a)
What Optimal Level of Output (q*) will a Firm Produce given the
following?
MC(q) = 3 + 2q
Price (P) = $9
MC → Marginal Cost
q→ Quantity
(b) What is a Firm's Producer Surplus assuming the following?
Area of Triangle = 1/2* Base * Height
(c) Will a Firm be Earning a Positive, Negative, or Zero Profit in the
Short-Run given the following?
AVC (q) =3+q
FC = $3
AVC → Average Variable Cost
FC Fixed Cost

Expert Solution

Step 1: Define marginal cost

Marginal cost is the alternate in complete manufacturing fee that comes from making or producing one more unit. It’s calculated through dividing the alternate in manufacturing charges with the useful resource of the exchange in quantity.

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