Revenue and cost (dollars per unit) MC AVC 50 ..... 40 10 10 20 30 40 50 Output (units per day) The above figure illustrates a perfectly competitive firm. If the market price is $40 a unit, to maximize its profit (or minimize its loss) the firm should O A) produce 40 units. B) produce 30 units. C) shut down. O D) produce more than 10 and less than 30 units. O E) produce more than 30 units and less than 40 units.. 30 20

Revenue and cost (dollars per unit) MC AVC 50 ..... 40 10 10 20 30 40 50 Output (units per day) The above figure illustrates a perfectly competitive firm. If the market price is $40 a unit, to maximize its profit (or minimize its loss) the firm should O A) produce 40 units. B) produce 30 units. C) shut down. O D) produce more than 10 and less than 30 units. O E) produce more than 30 units and less than 40 units.. 30 20

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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$50 ATC $45 MC $40 $35 P= MR $30 AVC $25 $20 $15 $10 $5 $0 25 50 75 100 125 Output (Q) The diagram above shows a Perfectly Competitive firm in the short-run. This firm will maximize its profit by choosing the Output (Q) level: Select one: O a 60 O b. 100 O c. 75 O d. 50
am. 122.
A perfectly competitive firm should shut down in the short-run if price falls below the minimum of A) average variable costs. B) marginal revenue. C) fixed costs. O D) average total cost. E) marginal cost.
$ $11.00 $9.00 $6.00 0 This firm is experiencing an: O economic profit of $200 O economic loss of $1,100 Oeconomic loss of $200 economic profit of $1,100 k 85 100 MC ATC AVC MR Quantity
Economics Question
Which of the following is an expression of profit for a perfectly competitive firm? Profit for a perfectly competitive firm can be expressed as ⒸA. Profit=(PxQ)-(TCxQ), where P is price, Q is output, and TC is total cost. OB. Profit=P-MC, where P is price and MC is marginal cost. OC. Profit=PxQ, where is price and Q is output. O D. Profit=P-ATC, where P is price and ATC is average total cost. O E. Profit= (P-ATC) XQ, where P is price, Q is output, and ATC is average total cost.
Refer to the above graph for a purely competitive firm in the short run. What minimum output level should the firm produce just for it to break even? TC TR 9,800 5,600 2,100 300 800 1,400 Output (Q) Select one: O A. 800 and 300 O B. 300 only C. 800 and 1,400 D. 800 %24
$11.00 MC| $10.00 $9.00 ATC $8.00 $7.00 TRAVCI $6.00 $5.00 $4.00 $3.00 2 3 7 9 10 Quantity of Output (q) Pierre is a photographer in a perfectly competitive market. The graph shown above gives his MC, ATC and AVC curves. Suppose the market price is $10.50. How much profit does Pierre make? 22.5 24 20 O18 S per unit
The table below shows cost and revenue information for Choco Lovers, a purely competitive firm producing different quantities of chocolate gift boxes. Fill in the blanks in the table. Instructions: Enter your answers rounded to two decimal places. Choco Lovers Cost and Revenue Quantity TC ATC MC of Gift Boxes ($) ($) ($) 10 65.00 6.50 4.00 15 82.50 5.50 20 5.13 4.00 25 127.50 5.00 30 162.50 5.42 7.00 35 207.50 5.93 9.00 Assume the profit-maximizing price is $5 per gift box, and then answer the following questions: a. Profit-maximizing quantity = gift boxes b. Total revenue = $ c. Profit = $ d. Profit per unit = $ per gift box
A perfectly competitive firm will operate and incur an economic loss in the short run if O shareholders do not know about the loss. O the loss is smaller than its total fixed costs. O it knows it can recoup the loss in the long run. O the loss can offset future profits.
Assume Cathy's Cupcake Company operates in a perfectly competitive market producing 10,000 cupcakes per day. At this output level, marginal cost exceeds this firm's price. Assuming price exceeds average variable cost, to maximize profits Cathy's should O a. stop producing since it is earning a loss. O b. decrease their output. Oc make no adjustments as they are already maximizing their profits. Od. increase their output. Both Stan and Kyle own potato chip factories. Stan's factory has low fixed costs and high variable costs. Kyle's factory has high fixed costs and low variable costs. Currently, each factory is producing 5.000 bags of potato chips at the same total cost. Complete the following statement with the correct answer. If each produces more, the costs of Kyle's factory will exceed those of Stan's factory. Ob. more, their costs will be equal. less, the costs of Kyle's factory will exceed those of Stan's factory. Od. less, their costs will be equal. If a firm is producing where…
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 Typed answer will be automatically saved. X₂ X² Ω· FC 10 10 10 10 10 10 10 10 10 Write your response here... VC Twos 0 3 7 12 18 25 33 42 52 TC 10 13 17 225755 28 35 43 62 AFC 0.67 0.29 AVC 0.60 0.70 0.90 1.00 1.10 ATC 2.60 1.47 1.43 1.49 MC 1.00 1.80 □