What is true with profit maximization of the firm using the Total Revenue Total Cost approach? PLEASE EXPLAIN A. The only requirement to find the optimal output that maximizes economic profit is that the difference between the total revenue and the total cost is the highest B. The total revenue should be lower than the total cost C. The total revenue should be higher than the total cost D. A and B are correct E. A and C are correct

What is true with profit maximization of the firm using the Total Revenue Total Cost approach? PLEASE EXPLAIN A. The only requirement to find the optimal output that maximizes economic profit is that the difference between the total revenue and the total cost is the highest B. The total revenue should be lower than the total cost C. The total revenue should be higher than the total cost D. A and B are correct E. A and C are correct

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Suppose a restaurant that is highly profitable during the summer months is unable to cover its total cost during the winter months. If it wants to maximize profits, the restaurant should a.lower its prices during the summer months. b.go a out of business immediately; losses should never be tolerated. c.continue operating during the winter months if it is able to cover its variable costs. d.shut down during the winter, even if it is able to cover its variable costs during that period.
why the answer is 150. Please answer correct calculation asap plz Don't answer by pen paper plz
Refer to the diagram to the right. In the long run, why will the firm produce Q, units and not Q units, which has a lower its average cost of production? OA. Although its average cost of production is lower when the firm produces Qg units, to be able to sell its output the firm will have to charge a price below average cost, resulting in a loss. B. The firm's goal is to charge a high price and make a small profit rather than a low price and no profit. O C. At Qg. average cost exceeds marginal cost so the firm will actually make a loss. Op. At Qg, marginal revenue t is less than average revenue cost which will result in a loss for the firm. Price and cost per unit ($) MR Q₁ QgQnQj Quantity MC ATC
A firms cost and revenue functions look like this in 3 questions below. Total cost: TC = 100 + 2Q + Q2 Marginal cost: MC = 2 + 2Q Price: P=22 What is the profit maximizing output? a. 8 b. 10 c. 12 d. 25 e. All the other answers are wrong. What is the firm's profit? a. -14 b. -6 c. 0 d. 15 e. All then other answers are wrong. What are the fixed costs and variable costs at the profit maximising output? a. FC=0, VC=220 b. FC=100, VC=80 c. FC=80, VC=244 d. FC=100, VC=120 e. All the other answers are wrong.
Assignment Instructions: Find the Graphs for a Pure Competition Firm Do a Google Images and find the graphs for a perfectly competitive firm. graphs must include the following specific graphs: Find the graph for short run economic loss for the firm. Find the graph for short run economic profit for the firm. Find the graph for long run – normal profit for the firm. Make sure the graphs show the area of economic profit or loss.
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At what point should firms shut down in the short run? a. when marginal revenue equals marginal costs b. when average revenue is below average costs c. when average revenue is above average total cost d. when average revenue is below average variable costs
I. A company produces at an output level where marginal cost is equal to marginal revenue and has the following revenue and cost levels: Total revenue = $1,450 Total cost = $1,500 Total variable cost = $1,300 What would you suggest? a. Shut down. b. Continue to produce because the loss is less than the total fixed cost. c. Increase production to lower the marginal cost. e. Raise the price. II. At current long-run production levels, the marginal revenue of a competitive firm is $15 and the marginal cost of the firm is $15. If the market is perfectly competitive, the firm should a. cut back on production. b. stop production all together. c. produce more. d. continue producing at current levels.
If a firm's marginal revenue is smaller than its marginal cost, then the firm should a. increase output to increase profit. b. decrease output to increase profit. c. keep output the same. d. collect additional information before taking any action.
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Question 10 please solve
The following figure shows the total cost and total revenue for a firm when it prices its products at $8 and $10. Price A 0 C H F JG 1. total fixed costs are OA. 2. economic profits equal BH. 3. average cost equals DG divided by OG. 4. total cost is minimized at B. TC TRO (P=$10) TR1 (P=$8) Output When the firm is producing the profit-maximizing level of output at a price of $10: