The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Buddies, a perfectly competitive firm thatproduces novelty ear buds in a competitive market. The market price of ear buds is $6.00 per pair.Buddies Production CostsQuantityMCATCof Ear Buds($)($)252.2302.022.17352.452.21nces403.572.384542.56505.462.85555.933.13608.533.58 pairsInstructions: In parts b-d, round your answers to 2 decimal places.b. At the profit-maximizing quantity, what is the total cost of producing ear buds?%24c. If the market price for ear buds is $6 per pair, and Buddies produces the profit-maximizing quantity of ear buds, what is Buddiesweekly profit?24d. If the market price is $5.50 per pair, and Buddies produces the profit-maximizing quantity of ear buds, what is Buddies weeklyprofit?$4e. Buddies earns a normal profit whenO marginal cost equals average cost at the minimum of average cost.O marginal cost equals average cost.O marginal cost equals marginal revenue at the minimum of marginal cost.O average cost equals average revenue at the minimum of average cost.

There is a perfectly competitive firm that produces earbuds in a competitive market. A…

Answered: The table below shows the weekly…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Many companies start with cost to determine price since revenue must cover cost for the firm to make a profit. True False
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 $6 per pair, and Buddies produces the profit-maximizing quantity of ear buds, what will Buddies profit or loss be per week? 2$
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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 $6.00 per pair. Buddies Production Costs Quantity MC ATC of Ear Buds ($) ($) 25 2.20 30 2.02 2.17 35 2.45 2.21 40 3.57 2.38 45 4.00 2.56 50 5.46 2.85 55 5.93 3.13 60 8.53 3.58 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?
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