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- A B C D G H Question 3: Profit Maximization for a Perfectly Competitive Firm (Parts a - g) 3 1 5 6 7 E You will complete the rest of table as specified in the following parts of this assignment. b) Use Excel functions to calculate TC = 20 + 10*Q+ 2*Q² and MC. Verify that MC = 10 + 4*Q. c) Use Excel functions to calculate Profit = TR - TC. d) Use the MAX function in Excel to find the highest profit this perfectly competitive firm can earn. Hints: F TR =P*Q MR = change in TR/ change in Q MC change in TC/ change in Q Profit = TR - TC Profit is max at Q, such that MR = MC. Answers: I Parts (a)- (c): J a) Create a table with 15 rows and 8 columns. Name the columns Price (P), Quantity (Q), Total revenue (TR), Marginal revenue (MR), Total cost (TC), Marginal cost (MC), Profit, and Average total cost (ATC Fill in price of $50 and enter values of 0-13 for quantity. Use Excel functions to calculate TR and MR. P Q TR MR TC MC Profit ATC What is the profit-maximizing output? Verify that it satisfies the condition MR = MC. e) Use the MIN function in Excel to find the break-even price of this company. f) Re-do the table you created in the previous parts if FC increases to $30. Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). + g) Re-do the table you created in the previous parts if the output price decreases to $42. Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). K L M Part (f): N To O TR

- A B C D G H Question 3: Profit Maximization for a Perfectly Competitive Firm (Parts a - g) 3 1 5 6 7 E You will complete the rest of table as specified in the following parts of this assignment. b) Use Excel functions to calculate TC = 20 + 10*Q+ 2*Q² and MC. Verify that MC = 10 + 4*Q. c) Use Excel functions to calculate Profit = TR - TC. d) Use the MAX function in Excel to find the highest profit this perfectly competitive firm can earn. Hints: F TR =P*Q MR = change in TR/ change in Q MC change in TC/ change in Q Profit = TR - TC Profit is max at Q, such that MR = MC. Answers: I Parts (a)- (c): J a) Create a table with 15 rows and 8 columns. Name the columns Price (P), Quantity (Q), Total revenue (TR), Marginal revenue (MR), Total cost (TC), Marginal cost (MC), Profit, and Average total cost (ATC Fill in price of $50 and enter values of 0-13 for quantity. Use Excel functions to calculate TR and MR. P Q TR MR TC MC Profit ATC What is the profit-maximizing output? Verify that it satisfies the condition MR = MC. e) Use the MIN function in Excel to find the break-even price of this company. f) Re-do the table you created in the previous parts if FC increases to $30. Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). + g) Re-do the table you created in the previous parts if the output price decreases to $42. Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). K L M Part (f): N To O TR

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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File 20 19 Home 23 24 25 Insert Calibri 26 X ✓ fx 27 28 29 Draw Page Layout く 11 A B C D G H Question 3: Profit Maximization for a Perfectly Competitive Firm (Parts a - g) E Answers: B TR =P*Q MR = change in TR/ change in Q MC = change in TC/ change in Q Profit= TR - TC Profit is max at Q, such that MR = MC. Parts (a) - (c): P Q Formulas F TR Data SV You will complete the rest of table as specified in the following parts of this assignment. b) Use Excel functions to calculate TC = 20 + 10*Q + 2*Q² and MC. Verify that MC = 10 + 4*Q. 1 c) Use Excel functions to calculate Profit = TR - TC. 2 d) Use the MAX function in Excel to find the highest profit this perfectly competitive firm can earn. 3 What is the profit-maximizing output? Verify that it satisfies the condition MR = MC. 4 5 6 MR Av... Review TC I e) Use the MIN function in Excel to find the break-even price of this company. f) Re-do the table you created in the previous parts if FC increases to $30. Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). 7 g) Re-do the table you created in the previous parts if the output price decreases to $42. 8 Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). 9 20 Hints: 21 22 MC View Ev ab Profit J a) Create a table with 15 rows and 8 columns. Name the columns Price (P), Quantity (Q), Total revenue (TR), Marginal revenue (MR), Total cost (TC), Marginal cost (MC), Profit, and Average total cost (ATC) Fill in price of $50 and enter values of 0-13 for quantity. Use Excel functions to calculate TR and MR. P Q TR MR TC MC Profit ATC Automate Help ATC K Merge ✓ L General + M Part (f): P Editing Q N $ TR LA 0 L MR
Transcribed Image Text:File 20 19 Home 23 24 25 Insert Calibri 26 X ✓ fx 27 28 29 Draw Page Layout く 11 A B C D G H Question 3: Profit Maximization for a Perfectly Competitive Firm (Parts a - g) E Answers: B TR =P*Q MR = change in TR/ change in Q MC = change in TC/ change in Q Profit= TR - TC Profit is max at Q, such that MR = MC. Parts (a) - (c): P Q Formulas F TR Data SV You will complete the rest of table as specified in the following parts of this assignment. b) Use Excel functions to calculate TC = 20 + 10*Q + 2*Q² and MC. Verify that MC = 10 + 4*Q. 1 c) Use Excel functions to calculate Profit = TR - TC. 2 d) Use the MAX function in Excel to find the highest profit this perfectly competitive firm can earn. 3 What is the profit-maximizing output? Verify that it satisfies the condition MR = MC. 4 5 6 MR Av... Review TC I e) Use the MIN function in Excel to find the break-even price of this company. f) Re-do the table you created in the previous parts if FC increases to $30. Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). 7 g) Re-do the table you created in the previous parts if the output price decreases to $42. 8 Compare the highest profit this firm is able to make and the profit-maximizing output level with those found in part (d). 9 20 Hints: 21 22 MC View Ev ab Profit J a) Create a table with 15 rows and 8 columns. Name the columns Price (P), Quantity (Q), Total revenue (TR), Marginal revenue (MR), Total cost (TC), Marginal cost (MC), Profit, and Average total cost (ATC) Fill in price of $50 and enter values of 0-13 for quantity. Use Excel functions to calculate TR and MR. P Q TR MR TC MC Profit ATC Automate Help ATC K Merge ✓ L General + M Part (f): P Editing Q N $ TR LA 0 L MR
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