Q.No.2: Consider total cost and total revenue given in the following table: Quantity 3 5 7 Total cost 8 10 11 13 19 27 37 Total Revenue 8 16 24 32 40 48 56 I. Calculate profit for each quantity. How much should the firm produce to maximize profit? II. Calculate marginal revenue and marginal cost for each quantity. Graph them. (Hint: Put the points between whole numbers. For example, the marginal cost between 2 and 3 should be graphed at 2.5) At what quantity do these curves cross? How does this relate to your answer to part (a)? III.Can you tell whether this firm is in a competitive industry? If so, can you tell whether the industry is in a long-run equilibrium?

Q.No.2: Consider total cost and total revenue given in the following table: Quantity 3 5 7 Total cost 8 10 11 13 19 27 37 Total Revenue 8 16 24 32 40 48 56 I. Calculate profit for each quantity. How much should the firm produce to maximize profit? II. Calculate marginal revenue and marginal cost for each quantity. Graph them. (Hint: Put the points between whole numbers. For example, the marginal cost between 2 and 3 should be graphed at 2.5) At what quantity do these curves cross? How does this relate to your answer to part (a)? III.Can you tell whether this firm is in a competitive industry? If so, can you tell whether the industry is in a long-run equilibrium?

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 9PA

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