Scenario 14-1 Assume a certain firm in a competitive market is producing Q- 1,000 units of output. At Q- 1,000, the firm's marginal cost equals $15 and its average total cost equals $11. The firm sells its output for S$12 per unit. 8 22. Refer to Seenario 14-1. At Q-999, the firm's profits equal a. $993. M C= 15 ATC= 11 b. $997. c. $1,003. d. $1,007. Price - 12

Scenario 14-1 Assume a certain firm in a competitive market is producing Q- 1,000 units of output. At Q- 1,000, the firm's marginal cost equals $15 and its average total cost equals $11. The firm sells its output for S$12 per unit. 8 22. Refer to Seenario 14-1. At Q-999, the firm's profits equal a. $993. M C= 15 ATC= 11 b. $997. c. $1,003. d. $1,007. Price - 12

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Assume a competitive firm faces a market price of $100, a cost curve of: C= 1.00g + 25g + 1,600 and a marginal cost curve of: MC = 2.00g + 25. The firm's profit maximizing output level is 37.50 units, the profit per unit is $-5.17, and total profit is: $-193.88. However, if the firm wanted to maximize the profit per unit, how much would it produce? It would produceunits. (round your answer to two decimal places) If the firm produced this output level, what woulid be the profit? Its profit would be $. (round your answer to the nearest penny)
Suppose you are a perfectly competitive firm producing computer memory chips. Your production capacity is 1000 units pe r year. Your marginal cost is P10 per chip up to capacity. You have a fixed cost of P10,000 if production is positive and P0 if you shut down. What are your profit-maximizing levels of production and profit if the market price is (A) P5 per chip, (B), P15 per chip, and (C) P25 per chip? For case (B), explain why production is positive even though profits are negative.
Assume a competitive firm faces a market price of $100, a cost curve of: C = 0.25q + 50q + 1,600 and a marginal cost curve of: MC = 0.50g + 50. The firm's profit maximizing output level is 100.00 units, the profit per unit is $9.00, and total profit is: $900.00. However, if the firm wanted to maximize the profit per unit, how much would it produce? It would produce units. (round your answer to two decimal places) If the firm produced this output level, what would be the profit? Its profit would be S. (round your answer to the nearest penny)
Scenario 14-2 The information below applies to a competitive firm that sells its output for $40 per unit. • When the firm produces and sells 150 units of output, its average total cost is $24.50. • When the firm produces and sells 151 units of output, its average total cost is $24.55. Refer to Scenario 14-2. Let Q represent the quantity of output. Which of the following magnitudes has the same value at Q = 150 and at Q = 151? O a. Total cost O b. Average fixed cost O O d. Total revenue c. Average revenue
Consider a company that operates in a competitive market, with a typical set of cost curves (Marginal Cost, Average Variable Cost, Average Fixed Cost and Average Cost with typical formats of Microeconomics theory). Consider further that Marginal Costs coincide with Average Total Costs when the firm's output is 200 units of output, at a market price of 50. If market prices fall to 40, the company will produce 180 units of product to maximize its profit. If at this point the Average Fixed Costs per unit of output equals 27 per unit of output, what are your recommendations for this company in the short term? And in the long run?
Suppose that the firm with the costs and revenues shown in the graph below is contemplating whether or not to produce 12 units of output. If it were to produce this many units, what (if anything) would happen to the market price? What would be the firm's marginal revenue for the 12th unit produced? What would be the firm's total revenues per hour? Price and Marginal Cost ($ per unit) $6 E MC 10 11 12 13 14 Output (units per hour) Answer: This firm is in relation to the industry as a whole that its production market price, which would , so its output rate is influence the $6 per unit. The market price the firm's marginal revenue, which therefore would be MR unit. The firm's hourly total revenues if it were to produce 12 units would be TR $72. + $6 per 4
The information below applies to a competitive firm that sells its output for $40 per unit. • When the firm produces and sells 150 units of output, its average total cost is $24.50. • When the firm produces and sells 151 units of output, its average total cost is $24.55. Refer to Scenario 14-2 . Let Q represent the quantity of output. Which of the following magnitudes has the same value at Q = 150 and at Q = 151? a. Total revenue b. Average fixed cost c. Total cost d. Average revenue
3. Suppose there is a firm that is producing goods x and goods y. The current revenue for the firm is R(q2, qy): = 100qr +25qy while the firm's overall cost is: C(qr,qy)=40+0.5q – 24r4y+2.5q At this moment the firm has decided to produce qr = 50 and qy = 25. Statement: Based on marginal analysis of the data given, production is optimal. the firm's choice of
Assume a competitive firm faces a market price of $60, a cost curve of: C = 0.004q³ + 50q + 750, MC = 0.012q² + 50. The firm's profit maximizing output level is units (enter your response rounded to two decimal places), and the per unit profit at this output level is $ two decimal places-include the minus sign if necessary). and a marginal cost of: This firm will in the short-run. The firm will realize In the long-run, if circumstances do not change, this firm will (enter your response rounded to
Mondi Company produces party boxes that are sold in bundles of 1000 boxes. The market is highly competitive, with boxes currently selling for R100 per thousand. The company has a total and marginal cost curve given by: TC = 3,000,000 + 0.001Q2 MC = 0.002Q Q is measured in thousand box bundles per year. [5] a. Determine Mondi's profit maximizing quantity. b. Calculate if the firm is earning a profit or a loss? c. Based on the analysis above, should Mondi Company operate or shut down in the shortrun?
Suppose that the manager of a firm operating in a competitive market has estimated the firm’s average variable cost function to be AVC = 10 – 0.03Q + 0.00005Q2, TFC = 60. The optimum profit is a. 348 b. -245 c. 1,200 d. -15.2 e. 255 f. None of the above
Assume a certain firm is producing Q = 1,000 units of output. At Q = 1,000, the firm's marginal cost equals $10 and its average total cost equals $25. The firm sells its output for $30 per unit. At Q = 999, the firm's profits equal $4,990. O $5,000. $5,020. $4,980.