Consider the table of marginal costs of producing t-shirts in a perfectly competitive market below. If the market price is equal to $8, what is the profit maximizing number of t-shirts to produce and sell? Note the second column describes marginal costs. 0 0 01 02 O 3 O 4 05 6 T-shirts 0 1 2 3 4 5 6 Marginal Cost 6 3 6 9 11 14
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- he widget market is competitive and includes no transaction costs. Five suppliers are willing to sell one widget at the following prices: $20, $12, $8, $4, and $2 (one seller at each price). Five buyers are willing to buy one widget at the following prices: $8, $12, $20, $32, and $44 (one buyer at each price). For each price shown in the following table, use the given information to enter the quantity demanded and quantity supplied. Price Quantity Demanded Quantity Supplied ($ per widget) (widgets) (widgets) $2 $4 $8 $12 $20 $32 $44 In this market, the equilibrium price will be ___ ($) per widget, and the equilibrium quantity will be _____ (#) widgets.Paulina sells beef in a competitive market where the price is $8 per pound. Her total revenue and total costs are given in the table below. Quantity of Total revenue Total cost beef (lb.) 0 1 2 3 4 ($) 0 8 16 24 32 ($) 4 8 13 19 27 Profit ($) 0 8 pounds Marginal revenue ($) c. What is the profit-maximizing (or loss-minimizing) quantity? Marginal Marginal cost ($) profit ($) a. Complete the table. Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. b. At what quantity does marginal revenue equal marginal cost? pounds AWhy does a Starbucks coffeehouse face a downward–sloping demand curve while a dairy farmer has a horizontal demand curve? What other suppliers might face a downward–sloping demand curve?
- For the following exercise, which has already been published previously, please you only need to answer question d) A publisher has the following table of demand for the next novel by one of its famous authors: Price Number of novel in demand 100 0 90 1 80 2 70 3 60 4 50 5 40 6 30 7 20 8 10 9 0 10 The author is paid $2 to write the book (Fixed Cost or FC) and the marginal cost (MC) of publishing it is a constant $10 per book. a) Calculate the total revenue, total cost, and corresponding profits for each quantity. What quantity would a profit-maximizing publisher choose? What price would he set? b) Calculate marginal revenue. How does marginal revenue compare to price? Explain. c) Plot the marginal revenue (MR), marginal cost (MC), and demand (D) curves. At what quantity do the marginal revenue and marginal cost curves intersect? What does this mean? d) Obtain the economic profits (EP) of this monopolist and graph.Paulina sells beef in a competitive market where the price is $6 per pound. Her total revenue and total costs are given in the table below. Quantity of beef (lb.) 0 1 2 3 4 Total revenue ($) Total cost ($) 0 4 (A) 1 pound (B) 2 pounds (C) 3 pounds (D) 4 pounds 6 12 18 24 6 10 15 21 What is the profit-maximizing (or loss minimizing) quantity? Profit ($) Marginal revenue ($) Marginal cost ($) Marginal profit ($)2. The demand curve facing a competitive firm The following graph illustrates the market for large moving trucks in Eugene, OR, during Oregon's fall move-in week. PRICE (Dollars per large truck) 400 360 320 Demand 280 240 200 8 160 120 80 40 0 1 3 4 5 6 7 8 QUANTITY (Hundreds of large trucks) 2 Supply + 9 10 (2)
- Using the graph on the next page, do the following problems: Determine the profit maximizing level of output when the market price for the good is $75/unit. Show this on the graph by making the appropriate drawing (with a straight-edge). Also, write the number (an appropriate estimate should be made) below the graph. • On the graph, show the maximum total profit that can be generated by the firm based on the market price. Do NOT calculate the value - show the appropriate box on the graph. Be careful in your (straight) lines. Be clear as to the part of the graph that represents the profit. Use shading as appropriate. • Below the graph, write the interpretation of the values of the marginal cost (MC) and the average total cost (ATC) at the profit-maximizing level of output; make sure to use all the appropriate names and units. Write the values and interpretations below the graph. • Answer the following questions: If the market price of the good falls, the profit maximizing level of…You decide to create a burger restaurant named BurgerDeals to help pay for college fees. The table below contains total pricing information for your single product, large extra-cheese burger. Your town's burger market is fiercely competitive, with big extra-cheese burger selling for $7 on average. Fill in the blanks in the table and answer the following question. What does each burger cost on average if you make 8 burgers?Suppose that YouYeet is one of over a dozen competitive firms in the Oviedo area that offers moving truck rentals. Based on the preceding graph showing the weekly market demand and supply curves, the price YouYeet must take as given is . Fill in the price and the total, marginal, and average revenue YouYeet earns when it rents 0, 1, 2, or 3 trucks during move-in week. Quantity Price Total Revenue Marginal Revenue Average Revenue (Trucks) (Dollars per truck) (Dollars) (Dollars) (Dollars per truck) 0 0 – 1 2 3 The demand curve faced by YouYeet is identical to which of its other curves? Check all that apply. Supply curve Marginal revenue curve Average revenue curve Marginal cost curve
- Suppose High-Tech Software sells two products-a word-processing package and a spreadsheet package. Suppose that the business community values the word-processing package at $100 per unit and the spreadsheet package at $250 per unit while the university community values the word-processing package at $125 and the spreadsheet at $200. (Assume that the marginal cost of each unit is zero.) a. What are the profit-maximizing price that High-Tech should charge if they sell each product separately and what is the total price of the two goods? b. If High-Tech is able to engage in tying, what is the profit-maximizing price for the two products as a bundle? c. Should this be legal?13. You just got a patent for the first commercial self-driving car. The following table shows the elasticity of the demand and the marginal cost of production of your cars in several production centers across the globe. Assuming that this are constant, can you approximate what would be the optimal price for your cars? City Marginal Cost Elasticity Price Wolfburg, Germany Barcelona, Spain Tokyo, Japan Ulsan, South Korea East London, South Africa Mexico City, Mexico $20, 000 $18, 000 $22, 000 $16, 000 $10, 000 $12, 000 -1.5 $60, 000.00 $24, 000.00 $33, 000.00 $32, 000.00 $11, 428.60 $14, 400.00 -4.0 -3.0 -2.0 -8.0 -6.0The figure below shows the costs of Quick Copy, one of many copy shops near campus. If the market price of copying is 10¢ a page, calculate Quick Copy's profit- maximizing output and economic profit. hour. hour. Cost (cents per page) 12 hour. 10 4 100 60 80 Quantity (pages per hour) Profit-maximizing quantity is 60 pages an hour and economic profit is $3.20 an hour. 2 20 MC 40 Profit-maximizing quantity is 80 pages an hour and economic profit is $7 an ATC Profit-maximizing quantity is 40 pages an hour and economic profit is $2.40 an Profit-maximizing quantity is 80 pages an hour and economic profit is $2.40 an