Yann's bakery operates in a perfectly competitive market where the prevailing price for a baguette (his only product) is $3. If Yann's marginal cost function is given by MC=0.1q: (i) Yann's profit-maximizing level of output is (ii) Yann's variable profit is (iii) The producer surplus is If Yann also has a fixed cost of $50, then: (iv) his total profit is Assuming Yann cannot avoid the fixed cost, Yann should

Yann's bakery operates in a perfectly competitive market where the prevailing price for a baguette (his only product) is $3. If Yann's marginal cost function is given by MC=0.1q: (i) Yann's profit-maximizing level of output is (ii) Yann's variable profit is (iii) The producer surplus is If Yann also has a fixed cost of $50, then: (iv) his total profit is Assuming Yann cannot avoid the fixed cost, Yann should

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Answer Box: -5,0,3,5,10,30,45,50, continue to produce, shut down, Other

Yann's bakery operates in a perfectly competitive market where the prevailing price for a baguette (his only product) is $3. If
Yann's marginal cost function is given by MC=0.1q:
(i) Yann's profit-maximizing level of output is
(ii) Yann's variable profit is
(iii) The producer surplus is
If Yann also has a fixed cost of $50, then:
(iv) his total profit is
Assuming Yann cannot avoid the fixed cost, Yann should.
V

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Step 2: Determine Yann's profit-maximizing level of output:

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Step 3: Determine Yann's variable profit:

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Step 4: Determine the producer surplus:

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Step 5: Determine the total profit:

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market conditions in this industry. What is the maximum amount of profit the firm can earn? Firm Industry SMC ATC U X 0 20 40 60 80 100 Output of the firm Multiple Choice $50 $40 $80 D 5,000 Industry output 10,000
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400 300 200 120 100 100 220 320 400 500 580 a) $300 or less b) $120 Refer to the above Figure A. In the short-run this firm would shut-down at a price of c) $100 MC d) $200 or less /ATC AVC
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