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Suppose that a
The firm's profit-maximizing (or loss-minimizing) output level = . Write number only.
The firm's economic profit (or loss) at this output level = . Write either profit number or loss number:
e.g. profit 2000.
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- The information below applies to a competitive firm that sells its output for $44.00 per unit. . When the firm produces and sells 100 units of output, its average total cost is $24.50. . When the firm produces and sells 101 units of output, its average total cost is $24.75. Suppose the firm is currently producing and selling 100 units of output. Should the firm increase its output to 101 units? Yes. This is because the marginal revenue exceeds the marginal cost. Yes. This is because the marginal revenue exceeds the average total cos No. This is because the marginal cost exceeds the marginal revenue. No. This is because the average total cost exceeds the marginal revenue.Suppose that each firm in a competitive industry has the following costs: Total cost: TC = 50 + 1/2q2 Marginal cost: MC = q Where q is an individual firm’s quantity produced. The market demand curve for the product is: Demand: QD = 120 – P Where P is the price and Q is the total quantity of the good. Currently there are 9 firms in the market. What is each firm’s fixed cost? What is its variable cost? Give the equation for average total cost. Graph the average-total-cost curve and the marginal-cost curve for q from 5 to 15. At what quantity is the average-total-cost curve at its minimum? What is the marginal cost and average total cost at that quantity? Give the equation for each firm’s supply curve. Give the equation for the market supply curve for the short run in which the number of firms is fixed. What is the equilibrium price and quantity for the market in the short run? In this equilibrium, how much does each firm produce? Calculate the firm’s profit and loss. Do firms have…Suppose that a perfectly competitive firm faces a market price of $12 per unit, and at this price the upward-sloping portion of the firm's marginal cost curve crosses its marginal revenue curve at an output level of 1,800 units. If the firm produces 1,800 units, its average variable costs equal $7.00 per unit, and its average fixed costs equal $1.00 per unit. What is the firm's profit-maximizing (or loss-minimizing) output level? What is the amount of its economic profits (or losses) at this output level?
- The graph shows the demand curve (D), average total cost curve (ATC), average variable cost curve (AVC), and the 90 - marginal cost curve (MC) for a perfectly (or purely) 80 - competitive firm. D= MR 70- Assuming that this firm maximizes profit, what is this firm's profit? 60 - ATC 50 AVC profit: $ 40 40- 30- MC 20 - 10- 40 10 20 30 50 60 70 80 90 Quantity Price and cost ($)Suppose that each firm in a competitive industry has the following costs: Total cost: TC = 50 + 1/2q2 Marginal cost: MC = q where q is an individual firm's quantity produced. The market demand curve for this product is Demand: QD where P is the price and Q is the total quantity of the good. Currently, there are 9 firms in the market. = 120 – P а. What is each firm’s fixed cost? What is its variable cost? Give the equation for average total cost. b. Graph average-total-cost curve and the marginal-cost curve for q from 5 to 15. At what quantity is average-total-cost curve at its minimum? What is marginal cost and average total cost at that quantity? с. Give the equation for each firm's supply curve. d. Give the equation for the market supply curve for the short run in which the number of firms is fixed. е. What is the equilibrium price and quantity for this market in the short run? In this equilibrium, how much does each firm produce? Calculate each firm's profit or ^ loss. Is there…Suppose the market for apples is perfectly competitive. The short-run average total cost and marginal cost of growing apples for an individual grower are illustrated in the figure to the right. 40- 36- Assume that the market price for apples is $26.00 per box. What is the 32- MC profit-maximizing quantity for apple growers to produce? 75 boxes. 28- (Enter your response as an integer.) 24- At this level of output, profit will be $ 1950. (Enter your response rounded to the nearest dollar.) 20- ATC 16- 12- 8- 4- 10 20 30 40 50 60 70 80 90 100 Output (boxes of apples per day) Price (dollars per box)
- A firm produces a product in a competitive industry and has a total cost function (TC) of TC(q) = 100+8q+2q² and a marginal cost function (MC) of MC(q) = 8 +4q. At the given market price (P) of $18, the firm is producing 2.50 units of output. Is the firm maximizing profit? Yes What quantity of output should the firm produce in the long run? The firm should produce unit(s) of output. (Enter your response as an integer.)The table below shows the total revenue (TR) and total cost (TC) for a perfectly competitive firm. At which quantity (Q) of output is the company's profit maximized? Hint: Note that the company cannot produce partial units. Provide your answer below: Quantity (Q) 7 8 9 10 11 12 Total Revenue (TR) $56 $64 $72 $80 $88 $96 Total Cost (TC) $36 $39 $44 $51 $60 $76A perfectly competitive firm produces the level of output at which MR=MC on the rising portion of the firm’s marginal cost curve. At that output level, it has the following costs and revenues: TC = $830,000 VC = $525,000 TR = $428,000 Given that the firm produces the level of output at which MR=MC, calculate the amount of profit (loss) this firm earns. is it Profit=TR-TC?
- The graph shows the average total cost (ATC) curve, the marginal cost (MC) curve, the average variable cost (AVC) curve, and the marginal revenue (MR) curve (which is also the market price) for a perfectly competitive firm that produces terrible towels. Answer the three accompanying questions, assuming that the firm is profit-maximizing and does not shut down in the short run. What is the firm's total revenue? Price $485 $450 $300 $225 205 260 Quantity 336 365 MC ATC AVC MR PSuppose rocking-chair manufacturing is a perfectly competitive industry in which there are 1,000 identical firms. Each firm's total cost is related to output per day as follows: Output Total Revenue ($) Total Variable Cost ($) Total Fixed Cost ($) 1 1,000 750 500 2,000 1,250 500 3,000 2,000 500 4,000 3,000 500 5 5,000 4,500 500 How many chairs would the firm produce at prices of $350? (In computing quantities, assume that a firm produces a certain number of completed chairs each day; it does not produce fractions of a chair on any one day.) chairs 2. 4)Suppose the market for apples is perfectly competitive. The short-run average total cost and marginal cost of growing apples for an individual grower are illustrated in the figure to the right. 40- 36 Assume that the market price for apples is $26.00 per box. What is the profit-maximizing quantity for apple growers to produce? 75 boxes. (Enter your response as an integer.) 32 MC 28 At this level of output, profit will be S 900. (Enter your response rounded to the nearest dollar.) Apple growers will earn positive economic profit in the short run at any market price above $ per box. (Enter your response rounded to one decimal 20- place.) ATO 12- 20 30 40 so 80 70 ao 90 100 Output (boxes of apples per day) (xoq jəd sejop) so
