Suppose that the market for sports watches is a competitive market. The following graph shows the daily cost curves of a firm operating in this market. PRICE (Dolars per w 100 0 @ ATC Price (Dollars per watch) QUANTITY (Thousands of watches) For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that quantity, using the data from the previous graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down, it will produce. (Hint: You can select the purple points [diamond symbols] on the previous graph to see precise information on average variable cost.) Quantity (Watches) Total Revenue (Dollars) Fixed Cost Variable Cost (Dollars) Profit (Dollars)

Suppose that the market for sports watches is a competitive market. The following graph shows the daily cost curves of a firm operating in this market. PRICE (Dolars per w 100 0 @ ATC Price (Dollars per watch) QUANTITY (Thousands of watches) For each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that quantity, using the data from the previous graph to identify its total variable cost. Assume that if the firm is indifferent between producing and shutting down, it will produce. (Hint: You can select the purple points [diamond symbols] on the previous graph to see precise information on average variable cost.) Quantity (Watches) Total Revenue (Dollars) Fixed Cost Variable Cost (Dollars) Profit (Dollars)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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