A purely competitive firm finds that the market
Instructions: Round your answers to 2 decimal places.
a. Does price equal or exceed average variable cost for the first 50 units?
(Click to select) No Yes
What is the average variable cost for the first 50 units?
b. Does price equal or exceed average variable cost for the first 100 units?
(Click to select) No Yes
What is the average variable cost for the first 100 units?
c. What is the marginal cost per unit for the first 50 units?
What is the marginal cost for units 51 and higher?
d. For each of the first 50 units, does MR exceed MC?
(Click to select) No Yes
What about for units 51 and higher?
(Click to select) No Yes
e. What output level will yield the largest possible profit for this purely competitive firm?
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For each of the first 50 units, does MR exceed MC?
For each of the first 50 units, does MR exceed MC?
- QUESTION 10 Jack sells water bottles. Assume the market for water bottles is perfectly competitive. Jack sells his water bottles at the market price of $9.00. At the profit-maximising output level of 51 water bottles, Jack's average total cost is $4.40 per water bottle. The minimum average variable cost is $3.90 per water bottle. Answer the following questions: a. Jack's economic profit or loss is decimal places (ie: to the nearest cent). (use a negative value if a loss). Answer in dollars, rounded to two b. State whether the following statement is true or false: "At the profit-maximising quantity, Jack is making an economic profit of $4.60 per water bottle." Type T for true, or F for false c. State whether the following statement is true or false: "Jack should shut down if the market price is $3.85 per water bottle." Type T for true, or F for falsearrow_forwardThis is all the infoarrow_forwardTable Cost.EX2: Costs and Outputs for a Competitive Firm Total Total Output Fixed Variable (Q) Costs Costs 0. $80.00 $0.00 $80.00 $70.00 $80.00 $120.00 $80.00 $150.00 $80.00 $220.00 5. $80.00 $300.00 Refer to Table Cost.EX2. When production is 4 units, the firm's average total cost is about O No answer text provided. O $75 O No answer text providcd. O 80 1.arrow_forward
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- Table Cost.EX2: Costs and Outputs for a Competitive Firm Total Total Output Fixed Variable (Q) Costs Costs $30.00 $0.00 1. $30.00 $70.00 $30.00 $120.00 3 $30.00 $150.00 4. $30.00 $220.00 $30.00 $300.00 Refer to Table Cost.EX2. When production is 3 units, the firm's average total cost is about O No answer text provided. O No answer text provided. S62.50 S60.00arrow_forwardLisa lawn company (LLC) is a lawn mowing business in a perfectly competitive market for lawn moving services. The following tables set out Lisa's costs Quantity(lawn per hour) Total Cost(dollars per lawn) 0 $30 1 $40 2 $55 3 $75 4 $100 5 $130 6 $165 A. If the market price is $30 per lawn, How many lawns per hour does Lisa's LLC now? B. If the market price is 30 per lawn, What is Lisa"s profit in the short run? C. if the market price falls to $20 per lawn, how many lawns per hour does Lisa's LLC now? D. if the market price falls to $20 per lawn, what is Lisa's profit in the short run? E. At What market price will Lisa shut down?arrow_forwardA firm in a purely competitive industry is currently producing 1,200 units per day at a total cost of $500. If the firm produced 1,000 units per day, its total cost would be $350, and if it produced 700 units per day, its total cost would be $325. Instructions: Enter your answers rounded to two decimal places. a. What is the firm's ATC per unit at these three levels of production? At 1,200 units per day, ATC = $ At 1,000 units per day, ATC = $ At 700 units per day, ATC = $ b. If every firm in this industry has the same cost structure, is the industry in long-run competitive equilibrium? (Click to select) V c. From what you know about these firms' cost structures, what is the highest possible price per unit that could exist as the market price in long-run equilibrium? 2$ d. If that price ends up being the market price and if the normal rate of profit is 10 percent, then what will each firm's accounting profit per unit be? cents per unitarrow_forward
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