Note:-Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.Answer completely.You will get up vote for sure. 3. Profit maximization using total cost and total revenue curvesSuppose Madison operates a handicraft pop-up retail shop that sells phone cases. Assume a perfectly competitive market structure for phone caseswith a market price equal to $25 per phone case.The following graph shows Madison's total cost curve.Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for phone cases for quantities zerothrough seven (including zero and seven) that Madison produces.TOTAL COST AND REVENUE (Dollars)20017515012510075500-25012345QUANTITY (Phone cases)6Total Cost78Total RevenueProfit? Calculate Madison's marginal revenue and marginal cost for the first seven phone cases they produce, and plot them on the following graph. Use theblue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity.COSTS AND REVENUE (Dollars per phone case)403530252015100012I34QUANTITY (Phone cases)5an amount678Marginal RevenueMarginal CostMadison's profit is maximized when they produce a total ofproduce is $phone cases. At this quantity, the marginal cost of the final phone case theythan the price received for each phone case they sell. At this point, the marginal cost of producing onemore phone case (the first phone case beyond the profit maximizing quantity) is $an amountthan the price received for eachphone case they sell. Therefore, Madison's profit-maximizing quantity occurs at the point of intersection between thecurves. Because Madison is a price taker, the previous condition is equivalent toI?

The financial gain of a firm when the total revenue surpasses the level of the total cost incurred…

Suppose Madison operates a handicraft pop-up retail shop that sells phone cases. Assume a perfectly competitive market structure for phone cases with a market price equal to $25 per phone case. The following graph shows Madison's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for phone cases for quantities zero through seven (including zero and seven) that Madison produces. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 -25 0 1 ■ 2 ☐ 0 ☐ 4 3 5 QUANTITY (Phone cases) 0 6 Total Cost 7 8 O Total Revenue A Profit (?)

Suppose Madison operates a handicraft pop-up retail shop that sells phone cases. Assume a perfectly competitive market structure for phone cases with a market price equal to $25 per phone case. The following graph shows Madison's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for phone cases for quantities zero through seven (including zero and seven) that Madison produces. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 -25 0 1 ■ 2 ☐ 0 ☐ 4 3 5 QUANTITY (Phone cases) 0 6 Total Cost 7 8 O Total Revenue A Profit (?)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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