SETTINGS الله 175 MC 150 125 100 75 50 25 ATC AVC MR D 0 20 40 60 80 100 120 140 160 180 Quantity (units per month) Reset PROFIT CALCULATIONS Market Price (P) $125.00 Cost Structure Low Cost High Cost Marginal Revenue (MR) $50.00 abcde klmno Marginal Cost (MC) $55.00 Quantity Revenue $7,500.00 10 120 Costs $5,066.67 Quantity 60 Profit $2,433.33 Instructions: Make sure the Interactive is set to "Natural Monopoly" on the upper right side of the Graph section. When "Natural Monopoly" is selected, it will have a dark blue background. With the Cost Structure (in the settings section) set to "a" a. What is the profit maximizing quantity? 60 units b. What is the maximum profit that can be earned? $ 2100 With the Cost Structure (in the settings section) set to "e" c. What is the profit maximizing quantity? units d. What is the maximum profit that can be earned? $ Let the Cost Structure remain at "e" e. If the firm decides to produce 80 units (where the average total cost equals demand-P-ATC) the Revenue is $ 8000] .the Costs are $ 8000 . and profits are $

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
SETTINGS
Cost Structure
Low
Cost
200
175
150
125
100
75
50
25
0
MC
ATC
AVC
MR
D
20
20
40
60
80 100
120
140 160 180
Quantity (units per month)
abcdefghijklmno
Quantity
10
Quantity
60
Reset
PROFIT CALCULATIONS
Market Price (P)
$125.00
High
Cost
Marginal Revenue (MR)
$50.00
Marginal Cost (MC)
$55.00
Revenue
$7,500.00
120
Costs
$5,066.67
Profit
$2,433.33
Instructions: Make sure the Interactive is set to "Natural Monopoly" on the upper right side of the Graph section. When "Natural
Monopoly" is selected, it will have a dark blue background.
With the Cost Structure (in the settings section) set to "a"
a. What is the profit maximizing quantity? 60
units
b. What is the maximum profit that can be earned? $ 2100
With the Cost Structure (in the settings section) set to "e"
c. What is the profit maximizing quantity?
units
d. What is the maximum profit that can be earned? $
Let the Cost Structure remain at "e"
e. If the firm decides to produce 80 units (where the average total cost equals demand --P= ATC) the Revenue is $ 8000 .the
Costs are $ 8000 . and profits are $
Transcribed Image Text:SETTINGS Cost Structure Low Cost 200 175 150 125 100 75 50 25 0 MC ATC AVC MR D 20 20 40 60 80 100 120 140 160 180 Quantity (units per month) abcdefghijklmno Quantity 10 Quantity 60 Reset PROFIT CALCULATIONS Market Price (P) $125.00 High Cost Marginal Revenue (MR) $50.00 Marginal Cost (MC) $55.00 Revenue $7,500.00 120 Costs $5,066.67 Profit $2,433.33 Instructions: Make sure the Interactive is set to "Natural Monopoly" on the upper right side of the Graph section. When "Natural Monopoly" is selected, it will have a dark blue background. With the Cost Structure (in the settings section) set to "a" a. What is the profit maximizing quantity? 60 units b. What is the maximum profit that can be earned? $ 2100 With the Cost Structure (in the settings section) set to "e" c. What is the profit maximizing quantity? units d. What is the maximum profit that can be earned? $ Let the Cost Structure remain at "e" e. If the firm decides to produce 80 units (where the average total cost equals demand --P= ATC) the Revenue is $ 8000 .the Costs are $ 8000 . and profits are $
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