1 Moving to another question will save this response.Question 5Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens.Outputper periodTVC ($)TFC ($)102203530401050155TABLE 9-3Refer to Table 9-3. This firm would produce no output in the short run if the market price of its outputdropped below $0.15.dropped below $0.20.dropped below $0.30.dropped below $2.00.dropped below $3.00.200000 Quèstion 9Suppose ABC Corp. is a firm producing newsprint in a perfectly competitive industry. We have the following information about the firm's production:- output (Q) = 1500 tonnes per month- average total cost (ATC) = $627 per tonne- average variable cost (AVC) = $614 per tonne- marginal revenue (MR) = $620 per tonne- marginal cost (MC) = $620 per tonneIn the short run, this firm shouldreduce output because the price per tonne is less than ATC.O increase output because MR is greater than AVC.O shut down because the firm is incurring economic losses.O maintain production at the current level.Not possible to determine because the price of the product is not known.

For a competitive firm p=mR and it should produce even in the losses if P> AVC.

Question 5 Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Output per period TFC ($) TVC ($) 10 20 3 5 30 6 40 10 50 15 TABLE 9-3 Refer to Table 9-3. This firm would produce no output in the short run if the market price of its output dropped below $0.15. dropped below $0.20. dropped below $0.30. dropped below $2.00. dropped below $3.00. O0000

Question 5 Consider the following total cost schedule for a perfectly competitive firm producing ball-point pens. Output per period TFC ($) TVC ($) 10 20 3 5 30 6 40 10 50 15 TABLE 9-3 Refer to Table 9-3. This firm would produce no output in the short run if the market price of its output dropped below $0.15. dropped below $0.20. dropped below $0.30. dropped below $2.00. dropped below $3.00. O0000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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