Solve: Assume this is a perfectly competitive market. Answer the following questions and explain your answers. Complete the table. Q TC FC VC AFC AVC ATC MC 0 $6.50 1 $9.50 2 $10.50 3 $11.50 4 $12.50 5 $13.50 67 $14.50 $18.00 8 $22.00 9 $26.50 10 $31.50 Assume that the market price is $3.50: What is the profit-maximizing level of output for this firm? What is the dollar amount of the profit, or loss? Canter What would happen with the number of firms in this market if the price drops to $3.00? Why? What would be the economic profit, or loss, for this firm if the fixed cost increases by $1.50 and the market price remains at $3.50? What is the long-run equilibrium price for this company? What is the shut-down price for this company?
Solve: Assume this is a perfectly competitive market. Answer the following questions and explain your answers. Complete the table. Q TC FC VC AFC AVC ATC MC 0 $6.50 1 $9.50 2 $10.50 3 $11.50 4 $12.50 5 $13.50 67 $14.50 $18.00 8 $22.00 9 $26.50 10 $31.50 Assume that the market price is $3.50: What is the profit-maximizing level of output for this firm? What is the dollar amount of the profit, or loss? Canter What would happen with the number of firms in this market if the price drops to $3.00? Why? What would be the economic profit, or loss, for this firm if the fixed cost increases by $1.50 and the market price remains at $3.50? What is the long-run equilibrium price for this company? What is the shut-down price for this company?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Transcribed Image Text:Solve:
Assume this is a perfectly competitive market.
Answer the following questions and explain your answers.
Complete the table.
Q
TC
FC
VC
AFC
AVC
ATC
MC
0
$6.50
1
$9.50
2
$10.50
3
$11.50
4
$12.50
5
$13.50
67
$14.50
$18.00
8
$22.00
9
$26.50
10
$31.50
Assume that the market price is $3.50:
What is the profit-maximizing level of output for this firm?
What is the dollar amount of the profit, or loss?
Canter
Transcribed Image Text:What would happen with the number of firms in this market if the price drops to $3.00? Why?
What would be the economic profit, or loss, for this firm if the fixed cost increases by $1.50 and
the market price remains at $3.50?
What is the long-run equilibrium price for this company?
What is the shut-down price for this company?
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