**Total Costs for Gregory's Jewelry Firm: Quantity vs. Cost**| Quantity | Total Cost ||----------|------------|| 0 | $64 || 1 | $79 || 2 | $98 || 3 | $120 || 4 | $145 || 5 | $171 || 6 | $198 || 7 | $228 || 8 | $262 || 9 | $305 || 10 | $353 |Gregory's Jewelry operates in a perfectly competitive market. The market price for necklaces is $32 per unit.**Exercises:****A. Calculate the Average Fixed Cost for 8 Units**- Show your work.**B. Identify the Profit Maximizing Quantity**- Use marginal analysis for explanation.**C. Calculate Economic Profit at Profit Maximizing Quantity from Part B**- Show your work.**D. Long-Run Industry Implications**- Based on Part C, will the number of firms increase, decrease, or stay the same? Explain.**E. Long-Run Price Implications**- Based on Part C, will the market price increase, decrease, or stay the same? Explain.**F. Demand for Necklaces and Cross Effects**- Elasticity of demand for necklaces: -3- Cross-price elasticity for bracelets with respect to necklaces price: 0.1- Based on Part E, predict demand changes for bracelets. Explain.**G. Market Equilibrium and Policy Implications**i. **Impact of Price Floor ($30/unit)**- Analyze changes in consumer surplus due to price floor imposition.ii. **Variable Cost Changes**- If heating and air conditioning costs decrease, assess short-run impact on profit-maximizing quantity. Explain.

According to marginal analysis, a profit-maximizing firm produces the level of output at which the…

The table below shows the total costs faced by Gregory's Jewelry firm for different quantities of necklaces sold. Quantity 0 1 2 3 4 5 6 7 8 9 10 Total Cost $64 $79 $98 $120 $145 $171 $198 $228 $262 $305 $353 Gregory's Jewelry firm sells necklaces in a perfectly competitive market with a downward sloping demand curve and an upward sloping supply curve. The market price is $32/unit. A. Calculate the average fixed cost of producing 8 units. Show your work. B. Identify the profit maximizing quantity. Explain using marginal analysis. C. Calculate the economic profit at the profit maximizing quantity you identified in Part B. Show your work.

The table below shows the total costs faced by Gregory's Jewelry firm for different quantities of necklaces sold. Quantity 0 1 2 3 4 5 6 7 8 9 10 Total Cost $64 $79 $98 $120 $145 $171 $198 $228 $262 $305 $353 Gregory's Jewelry firm sells necklaces in a perfectly competitive market with a downward sloping demand curve and an upward sloping supply curve. The market price is $32/unit. A. Calculate the average fixed cost of producing 8 units. Show your work. B. Identify the profit maximizing quantity. Explain using marginal analysis. C. Calculate the economic profit at the profit maximizing quantity you identified in Part B. Show your work.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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