The following graph illustrates the demand and marginal revenue curve (D=MR) of a perfectly competitive firm. Suppose that when the firm produces 70 units, its average variable cost equals $30 per unit and its average total cost equals $55 per unit. Use the green rectangle (triangle symbols) to plot the total cost of producing 70 units. Next, use the grey rectangle (star symbols) to plot the total variable cost of producing 70 units. Then, use the tan rectangle (dash symbols) to plot the total revenue at 70 units. Finally, use the purple rectangle (diamond symbols) to plot the profit or loss at 70 units.

The following graph illustrates the demand and marginal revenue curve (D=MR) of a perfectly competitive firm. Suppose that when the firm produces 70 units, its average variable cost equals $30 per unit and its average total cost equals $55 per unit. Use the green rectangle (triangle symbols) to plot the total cost of producing 70 units. Next, use the grey rectangle (star symbols) to plot the total variable cost of producing 70 units. Then, use the tan rectangle (dash symbols) to plot the total revenue at 70 units. Finally, use the purple rectangle (diamond symbols) to plot the profit or loss at 70 units.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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