Would the answer to this be b or a ? **Transcription for Educational Website**---**Table 8.7**| Number of Fruit Baskets | TFC | TVC | MC ||-------------------------|-------|-----|-----|| 0 | $50 | $0 | -- || 1 | 50 | 10 | 10 || 2 | 50 | 15 | 5 || 3 | 50 | 21 | 6 || 4 | 50 | 31 | 10 || 5 | 50 | 46 | 15 || 6 | 50 | 68 | 22 |- **TFC**: Total Fixed Costs- **TVC**: Total Variable Costs- **MC**: Marginal Cost**Questions**1) Only for this question refer to Table 8.7 (above). Assume that fruit baskets are sold in a perfectly competitive market. The market price of a fruit basket is $22. To maximize profits, Exotic Fruit should sell _________ fruit baskets and their profit is _________. A) three; $5 B) four; $7 C) five; $14 D) six; $14 2) If a firm is producing where MR > MC A) the revenue gained by producing one more unit of output exceeds the cost incurred by doing so. B) the revenue gained by producing one more unit of output equals the cost incurred by doing so. C) the revenue gained by producing one more unit of output is less than the cost incurred by doing so. ---**Explanation of Table 8.7**The table lists quantities of fruit baskets alongside their corresponding total fixed costs (TFC), total variable costs (TVC), and marginal costs (MC). The fixed costs remain constant, while the variable costs and marginal costs change as the number of fruit baskets changes. In a perfectly competitive market, firms aim to produce where the price equals marginal cost to maximize profits.

A theoretical market structure that meets the following requirements is known as pure or perfect…

Table 8.7 Number of Fruit Baskets TFC TVC TC MC $50 $0 $50 -- 1 50 10 60 10 50 15 65 50 21 71 4 50 31 81 10 50 46 96 15 6. 50 68 118 22 1) Only for this question refer to table 8.7 (above). Assume that fruit baskets are sold in a perfectly competitive market. The market price of a fruit basket is $22. To maximize profits, Exotic Fruit should sell fruit baskets and their profit is A) three; $5 B) four; $7 C) five; $14 D) six; $14

Table 8.7 Number of Fruit Baskets TFC TVC TC MC $50 $0 $50 -- 1 50 10 60 10 50 15 65 50 21 71 4 50 31 81 10 50 46 96 15 6. 50 68 118 22 1) Only for this question refer to table 8.7 (above). Assume that fruit baskets are sold in a perfectly competitive market. The market price of a fruit basket is $22. To maximize profits, Exotic Fruit should sell fruit baskets and their profit is A) three; $5 B) four; $7 C) five; $14 D) six; $14

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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