Total Average Average Average Marginal Product Fixed Cost Variable Cost Total Cost Cost $45 1 $60.00 $45.00 $105.00 40 2 30.00 42.50 72.50 35 20.00 40.00 60.00 30 4 15.00 37.50 52.50 35 12.00 37.00 49.00 40 10.00 37.50 47.50 45 7 8.57 38.57 47.14 55 8 7.50 40.63 48.13 65 6.67 43.33 50.00 75 10 6.00 46.50 52.50 a. At a product price of $56, will this firm produce in the short run? If it is preferable to produce, what will be the profit-maximizing or loss-minimizing output? What economic profit or loss will the firm realize per unit of output? b. Answer the questions of 4a assuming product price is $41. c. Answer the questions of da assuming product price is $32. d. In the following table, complete the short-run supply schedule for the firm (columns 1 and 2) and indicate the profit or loss incurred at each output (column 3). (2) Quantity Supplied, Single Firm Profit (+) or Loss () (4) Quantity Supplied Price 1,500 Firms $26 32 38 41 46 56 66 e. Now assume that there are 1,500 identical firms in this competitive industry; that is, there are 1,500 firms, each of which has the cost data shown in the table. Complete the industry supply schedule (column 4). I. Suppose the market demand data for the product are as follows: Total Quantity Price Domandod $26 17,000 32 15,000 38 13,500 41 12,000 46 10,500 56 9,500 66 8,000 What will be the equilibrium price? What will be the equilibrium output for the industry? For cach firm? What will profit or loss be per unit? Per firm? Will this industry expand or contract in the long run?
Total Average Average Average Marginal Product Fixed Cost Variable Cost Total Cost Cost $45 1 $60.00 $45.00 $105.00 40 2 30.00 42.50 72.50 35 20.00 40.00 60.00 30 4 15.00 37.50 52.50 35 12.00 37.00 49.00 40 10.00 37.50 47.50 45 7 8.57 38.57 47.14 55 8 7.50 40.63 48.13 65 6.67 43.33 50.00 75 10 6.00 46.50 52.50 a. At a product price of $56, will this firm produce in the short run? If it is preferable to produce, what will be the profit-maximizing or loss-minimizing output? What economic profit or loss will the firm realize per unit of output? b. Answer the questions of 4a assuming product price is $41. c. Answer the questions of da assuming product price is $32. d. In the following table, complete the short-run supply schedule for the firm (columns 1 and 2) and indicate the profit or loss incurred at each output (column 3). (2) Quantity Supplied, Single Firm Profit (+) or Loss () (4) Quantity Supplied Price 1,500 Firms $26 32 38 41 46 56 66 e. Now assume that there are 1,500 identical firms in this competitive industry; that is, there are 1,500 firms, each of which has the cost data shown in the table. Complete the industry supply schedule (column 4). I. Suppose the market demand data for the product are as follows: Total Quantity Price Domandod $26 17,000 32 15,000 38 13,500 41 12,000 46 10,500 56 9,500 66 8,000 What will be the equilibrium price? What will be the equilibrium output for the industry? For cach firm? What will profit or loss be per unit? Per firm? Will this industry expand or contract in the long run?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Assume that the cost data in the following table are for a purely competitive producer:
Transcribed Image Text:Total
Average
Average
Average
Marginal
Product
Fixed Cost Variable Cost Total Cost
Cost
$45
1
$60.00
$45.00
$105.00
40
2
30.00
42.50
72.50
35
20.00
40.00
60.00
30
4
15.00
37.50
52.50
35
12.00
37.00
49.00
40
10.00
37.50
47.50
45
7
8.57
38.57
47.14
55
8
7.50
40.63
48.13
65
6.67
43.33
50.00
75
10
6.00
46.50
52.50
a. At a product price of $56, will this firm produce in the
short run? If it is preferable to produce, what will be the
Transcribed Image Text:profit-maximizing or loss-minimizing output? What
economic profit or loss will the firm realize per unit of
output?
b. Answer the questions of 4a assuming product price is $41.
c. Answer the questions of da assuming product price is $32.
d. In the following table, complete the short-run supply
schedule for the firm (columns 1 and 2) and indicate the
profit or loss incurred at each output (column 3).
(2)
Quantity
Supplied,
Single Firm
Profit (+)
or Loss ()
(4)
Quantity
Supplied
Price
1,500 Firms
$26
32
38
41
46
56
66
e. Now assume that there are 1,500 identical firms in this
competitive industry; that is, there are 1,500 firms, each of
which has the cost data shown in the table. Complete the
industry supply schedule (column 4).
I. Suppose the market demand data for the product are as
follows:
Total Quantity
Price
Domandod
$26
17,000
32
15,000
38
13,500
41
12,000
46
10,500
56
9,500
66
8,000
What will be the equilibrium price? What will be the
equilibrium output for the industry? For cach firm? What
will profit or loss be per unit? Per firm? Will this industry
expand or contract in the long run?
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