The diagram shows a price-taking bakery's marginal and average cost curves, and its isoprofit curves. The current market price for bread is P*= 2.50. Which of the followingstatements is correct?8Price, P (€); cost43.702.50200Select one:20406080 100 120 140Quantity of loaves, Q160 180O a. The bakery is a price setter and sets its price as 2.50.b. The bakery maximises its profits by supplying 160 loaves.O c. The bakery's profit is 200.Marginal costcurveIsoprofit curve:€200Isoprofit curve:€80Firm's demandcurveZero-economic-profit curve(AC curve)200O d. The bakery's profit decreases until the quantity is 120, and then increases.e. The marginal cost curve is the bakery's supply curve.

Perfect competition is a market where there are many sellers and buyers and the sellers are…

The diagram shows a price-taking bakery's marginal and average cost curves, and its isoprofit curves. The current market price for bread is P*= 2.50. Which of the followin statements is correct? Price, P (€); cost 4 3.70 2.50 2 0 0 Select one: 20 40 Marginal cost curve 60 Isoprofit curve: €200 Isoprofit curve: €80 Firm's demand curve Zero-economic- profit curve (AC curve) 80 100 120 140 160 180 200 Quantity of loaves, Q O a. The bakery is a price setter and sets its price as 2.50. O b. The bakery maximises its profits by supplying 160 loaves. c. The bakery's profit is 200. Od. The bakery's profit decreases until the quantity is 120, and then increases. O e. The marginal cost curve is the bakery's supply curve.

The diagram shows a price-taking bakery's marginal and average cost curves, and its isoprofit curves. The current market price for bread is P*= 2.50. Which of the followin statements is correct? Price, P (€); cost 4 3.70 2.50 2 0 0 Select one: 20 40 Marginal cost curve 60 Isoprofit curve: €200 Isoprofit curve: €80 Firm's demand curve Zero-economic- profit curve (AC curve) 80 100 120 140 160 180 200 Quantity of loaves, Q O a. The bakery is a price setter and sets its price as 2.50. O b. The bakery maximises its profits by supplying 160 loaves. c. The bakery's profit is 200. Od. The bakery's profit decreases until the quantity is 120, and then increases. O e. The marginal cost curve is the bakery's supply curve.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

The following graph plots daily cost curves for a firm operating in the competitive market for demin overalls. Hint: Once you have positioned the rectangle on the graph, select a point to observe its coordinates. PRICE (Dollars per overalls) 50 10 10 5 0 MC 2 ATC 8 18 QUANTITY (Thousands of overallises per day) AVC 10 20 Profit or Loss In the short run, given a market price equal to $15 per overalls, the firm should produce a daily quantity of On the preceding graph, use the blue rectangle (circle symbols) to fill in the area that represents profit or loss of the firm given the market price of $15 and the quantity of production from your previous answer. Note: In the following question, enter a positive number regardless of whether the firm earns a profit or incurs a loss. The rectangular area represents a short-run thousand per day for the firm. $ overallses.
Consider a competitive firm with total costs given by T C(q) = 100 + 10q + q^2. The firm faces a market price p = 50. (a) Graph the AT C, AV C, MC, and MR curves in a single graph, and indicate the profit maximizing level of output. If there are profits, shade the region corresponding to profit and label it. (b) If fixed costs increase from 100 to 500, what happens to the profit maximizing level of output, T R, T C, and π? (c) If fixed costs increase from 100 to 500, should the firm continue to operate in the short-run? What about the long-run?
1) The cost curves for a firm in a perfectly competitive industry are given below. Complete the table. If the firm operates in a perfectly competitive market, and the market price is $25 per unit, what Quantity should this firm produce at? TFC TC TVC AVC ATC MC TR S100 S100 1 S100 S130 2 S100 S150 S100 S160 S100 S172 5 S100 S185 6 S100 $210 S100 $240 S100 $280 S100 $330 10 S100 $390 Table 9.1
Only typed solution
What would the answer be for 3 and 4?
Sketch a marginal cost curve for a firm that has constant marginal costs of production up to its capacity of 500 units but which cannot increase its output beyond that capacity PLEASEE SHOW THE CURVE
for a firm with price in excess of average total cost, the presence of ecomonics profits implies that the firm should increase output in the short runeven if the price is below marginal cost . true or false explain
Lisa lawn company (LLC) is a lawn mowing business in a perfectly competitive market for lawn moving services. The following tables set out Lisa's costs Quantity(lawn per hour) Total Cost(dollars per lawn) 0 $30 1 $40 2 $55 3 $75 4 $100 5 $130 6 $165 A. If the market price is $30 per lawn, How many lawns per hour does Lisa's LLC now? B. If the market price is 30 per lawn, What is Lisa"s profit in the short run? C. if the market price falls to $20 per lawn, how many lawns per hour does Lisa's LLC now? D. if the market price falls to $20 per lawn, what is Lisa's profit in the short run? E. At What market price will Lisa shut down?
The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Buddies, a purely competitive firm that produces novelty ear buds. Assume the market for novelty ear buds is a competitive market and that the price of ear buds is $6.00 per pair. Buddies Production Costs Quantity MC ATC of Ear Buds ($) ($) 20 1.00 25 2.00 1.20 30 2.46 1.41 35 3.51 1.71 40 4.11 2.01 45 5.43 2.39 50 5.99 2.75 55 8.47 3.27 Instructions: In part a, enter your answer as the closest given whole number. In parts b-d, round your answers to two decimal places. a. If Buddies wants to maximize profits, how many pairs of ear buds should it produce each week? pairs b. At the profit-maximizing quantity, what is the total cost of producing ear buds? 2$ c. If the market price for ear buds is $6 per pair, and Buddies produces the profit-maximizing quantity of ear buds, what will Buddies profit or loss be per week? 2$
Consider the market for ice cream. Suppose that this market is perfectly competitive. The cost structure of the typical ice cream producer is as follows. Average total cost is equal to 50 1 1 ATC(Q) +÷Q, average variable cost is equal to AVC(Q) =;Q, and marginal cost is equal to 2 MC(Q) = Q. Now, suppose that a new scientific study comes out that shows that soil pollution from rock salt (a key input for making ice cream) is extremely hazardous to human health. In response, the government decides to impose harsh re-zoning restrictions on any land once used for making ice cream. This reduces the market rent for land used to make ice cream, which in turn lowers the opportunity cost of operating an ice cream factory. This reduction in the opportunity cost of capital causes the total fixed cost of ice cream production to fall to 32, but there is no change to variable cost. Give formulas for the typical ice cream producer's new average total cost curve ATC(Q) and marginal cost curve MC(Q).
depict a ATC curve, one where the firm has negative profits(π < 0) at the profit maximizing output of 1000. Add an additional average cost curve that will allow you to determinewhether to shutdown or keep producing at Q = 1000.
The following graph plots the marginal cost (MC) curve, average total cost (ATC) curve, and average variable cost (AVC) curve for a firm operating in the competitive market for snapback hats. COSTS (Dollars) 100 100 80 90 80 20 70 70 HD 50 40 30 20 0 11 D 10 O MC Price (Dollars per snapback) 15 15 20 25 55 70 85 201 ATC 0 D AVC O 50 60 70 80 QUANTITY (Thousands of snapbacks) For every price level given in the following table, use the graph to determine the profit-maximizing quantity of snapbacks for the firm. Further, select whether the firm will choose to produce, shut down, or be indifferent between the two in the short run. (Assume that when price exactly equals average variable cost, the firm is indifferent between producing zero snapbacks and the profit-maximizing quantity of snapbacks.) Lastly, determine whether the firm will earn a profit, incur a loss, or break even at each price. □ Quantity (Snapbacks) BO 100 ▼ On the following graph, use the orange points (square symbol) to…