Econ Micro (book Only)
6th Edition
ISBN: 9781337408066
Author: William A. McEachern
Publisher: Cengage Learning
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Chapter 8, Problem 4P
To determine
Complete the table and answer the subparts.
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Q23
Suppose a perfectly competitive firm is currently operating with the following information: Output = 1500 tonnesAverage total cost = $627 per tonneAverage variable cost = $614 per tonneMarginal revenue = $620 per tonneMarginal cost = $620 per tonneAt the current level of output, this firm is _____ profit and is an earning economic profit of _____.
a.
Maximising; -$10500.
b.
Not maximising; -$10500.
c.
Maximising; $10500.
d.
Maximising; $9000.
e.
Not maximising; -$9000.
Q10 needed
Q8 pic is just for reference
Question 10
Refer to Table 5-1 and the firm in Question 8,
How much profit does the firm make at the chosen quantity?
(enter just the number, no $)
only typed answer
Assume a competitive firm faces a market price of $120, a cost curve of:
C = 13q3 + 20q + 500,
and a marginal cost of:
MC = q2 +20.
What is the firm's profit maximizing output level?
?? Units (round your answer to two decimal places)
What is the firm's profit maximizing price?
??? (round to the nearest penny)
What is the firm's profit?
??? (round to the nearest npenny)
In the short-run, this firm should ??
produce or shut down??
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- (Short-Run Profit Maximization) A perfectly competitive firm has the following fixed and variable costs in the short run. The market price for the firm's products is $150. Output FC VC TC TR Proft/Loss 0 $100 $0 _______ ________ ____________ 1 $100 $100 _______ ________ ____________ 2 $100 $180 _______ ________ ____________ 3 $100 $300 ________ ________ ____________ 4 $100 $440 _________ _________ ____________ 5 $100 $600 _________ _________ ____________ 6 $100 $780 _________ _________ ____________ a. Complete the table. b. At what output rate does the firm maximize profit or minimize loss? c. What is the firm's marginal revenue at each positive level of output? Its average revenue? d. What can you say about the relationship between marginal…arrow_forwardQUESTION 20 Study the table below which represents the cost and price schedules facing a perfectly competitive firm that manufactures bulbs. Use this information to answer the question. Quantity of the product 0 1 2 3 4 Price per unit (R) 10 10 10 10 10 10 c) d) 38022222 Total revenue Total profit (R) -10 -9 -5 -6 Marginal cost (R) . 9 6 8 10 13 Average variable cost (R) 9,00 7,50 7,67 8,25 9,20 This perfectly competitive firm will produce a) 3 bulbs, since losses are minimised. b) 4 bulbs, but it will consider shutting down in the short run. 4 bulbs, since at this production level it earns normal profit. 4 bulbs and will stay in operation.arrow_forwardConcept: Calculate Profit Farmer Jones grows sugar. The average total cost and marginal cost of growing sugar for an individual farmer are illustrated in the graph to the right. Assume the rharket for sugar is perfectly competitive. According to the graph, farmer Jones will earn profit (positive economic profit as opposed to losses) at any market price above $10 per bushel. (Enter a numeric response using an integer.) Assume that the market price specifically is $24 per bushel. If farmer Jones produces the profit maximizing quantity, what will be her profit? $ To more easily identify the price and quantity, click on the graph to the right, and then adjust the slider to change the price and quantity. Each increment will increase the price by $2. Enter your answer in the answer box and then click Check Answer. 40- 36- 32- MC 28- 24- 20- Price and cost (dollars per bushel) 12- ATC 46 20 30 40 50 60 70 80 90 100 Quantity of Sugar (bushels per month) Question Help Qarrow_forward
- Don't use chatgpt, I will 5 upvotes Detailed explanationarrow_forwardRequired information The following figure shows the costs for a perfectly competitive producer: AVC, ATC, MC $46 235 30 25 20 15 10 5 0 MC 10 20 30 40 50 60 70 80 90 100 ATC AVC Output per period Refer to the above figure to answer this question. If the price of the product is $10, what is the profit-maximizing (or loss-minimizing) output?arrow_forwardRequired information The following figure shows the costs for a perfectly competitive producer. AVC, ATC, MC $45 40 35 30 25 201 15 10 5 0 C 10 20 30 40 50 60 70 80 90 100 ATC AVC Output per period Refer to the above figure to answer this question. If the price of the product is $35, what is the profit-maximizing output?arrow_forward
- 1. The following table shows the cost information for a perfectly competitive firm. Production Total variable cost (RM)0 01 1002 1503 2104 2905 4006 5407 7208 950 a. If the total fixed cost of the firm is RM300, calculate total cost, average cost and marginal cost. b. If the market price is RM200, calculate the firm total revenue, and total profit/loss c. Determine the level of production that will maximise the firms profits.arrow_forwardGraph represents the cost structure of an individual firm in a perfectly competitive market. If the price decreases to $25, find the profit maximizing output of firm A by explaining the profit maximizing condition for a perfectly competitive firm. Calculate total revenue, total cost, total variable cost and the profit of the firm at the profit maximizing output.arrow_forwardQuestion 50 The streaming entertainment industry is currently making positive economic profit. What do we expect to happen in this market in the long run? (Assume that streaming entertainment is a perfectly competitive market.) New firms will enter the industry and the market price will increase New firms will enter the industry and the market price will decrease O Firms will exit the industry and the market price will increase O Firms will exit the industry and the market price will decreasearrow_forward
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