### Cost Chart Analysis#### Question 8Use the cost chart below to analyze a firm's performance in a perfectly competitive market. What is the profit (or loss, if it's negative) when the market price is $1.60?#### Table Breakdown:- **Q (Quantity):** 0, 5, 10, 15, 20, 25, 30, 35, 40- **FC (Fixed Costs):** $10 for all quantities- **VC (Variable Costs):** - 0 units: $0 - 5 units: $7 - 10 units: $12 - 15 units: $18 - 20 units: $22 - 25 units: $28 - 30 units: $33 - 35 units: $42 - 40 units: $52- **TC (Total Costs) = FC + VC:** - 0 units: $10 - 5 units: $17 - 10 units: $22 - 15 units: $28 - 20 units: $32 - 25 units: $38 - 30 units: $43 - 35 units: $52 - 40 units: $62#### Cost Per Unit Analysis:- **AFC (Average Fixed Cost):** - 0.29, 0.20, 0.14, 0.10, 0.08, 0.05, 0.29- **AVC (Average Variable Cost):** - 0.67, 0.60, 0.70, 0.90, 1.00- **ATC (Average Total Cost):** - 2.60, 1.47, 1.43, 1.49, 1.80- **MC (Marginal Cost):** - 1.00, 1.80#### Objective:By using this table, determine the profit or loss for the firm given that the market price is $1.60. Calculate profit or loss at each quantity to find the optimal production level for maximizing profit.

Total revenue will be calculated as price of the goods multiplied with the quantity of the sold…

Question 8 Use the cost chart: Assuming this firm competes in a perfectly competitive market. What is the profit (or loss, loss is a negative) when the price is $1.60. Cost Chart Q 0 5 10 15 20 25 30 35 40 FC 10 10 10 10 10 10 10 10 10 COMING VC 0 3 7 12 18 25 33 42 52 TC 10 13 17 22 28 35 43 52 62 AFC 0.67 0.29 AVC 0.60 0.70 ATC - 2.60 1.47 0.90 1.00 1.10 1.43 1.49 MC 1.00 1.80

Question 8 Use the cost chart: Assuming this firm competes in a perfectly competitive market. What is the profit (or loss, loss is a negative) when the price is $1.60. Cost Chart Q 0 5 10 15 20 25 30 35 40 FC 10 10 10 10 10 10 10 10 10 COMING VC 0 3 7 12 18 25 33 42 52 TC 10 13 17 22 28 35 43 52 62 AFC 0.67 0.29 AVC 0.60 0.70 ATC - 2.60 1.47 0.90 1.00 1.10 1.43 1.49 MC 1.00 1.80

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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