ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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- The relationship between the firm's average variable, average total, and marginal cost curves above: Marginal Reveue = Price = US $ 2.50 ; a) Use the graph to find the Firm's profit-maximizing output. b) If the firm maximizes its profit, how much profit does it make (about)? Should the firm stay in business? c) Will other firms with costs the same as Firms enter the market? Explain.arrow_forwardThe graph below depicts the revenue and cost curves for a firm operating in the athletic apperal market. Price, Costs (dollars) $24 $22 $20 $18 $16 $14 $12 $10 $8 $6 $4 $2 es is 0 Athletic Apparel 20 40 MC MR D Quantity ATC 60 80 100 120 140 Tools X Profit a. To maximize its profits, the firm should produce [ and charge a price of $[ b. What area represents the firm's profit? Instructions: Use the tool provided "Profit" to illustrate the profit for the firm. c. At its profit-maximizing level, profits are $arrow_forwardRefer to the figure below to answer the questions. 1.) A corn producer's profit is RM200 and is producing 100 bushels of corn. Then he must have a cost per bushel of __________. 2) A corn producer produces 80 bushels of corn and sells each bushel at RM5. The cost of producing each unit bushel is RM2. This corn producer's total revenue is ________ and profit is ________. 3) A corn producer's total revenue is RM1,000. If she sells each bushel of corn for RM5, she must be selling ________ bushels of corn.arrow_forward
- f) Redo the already filled out table (part a-c table) but if the FC is $30.What would the new profit maximizing output level be at what quantity? Put it in the table that says part f. g) Redo the already filled out table (part a-c) but if the output price is $42. Fill the new info in table (part g). Look at the graphs because it has what you need.arrow_forwardThe profit-maximising output will never be greater than the (profit-satisficing) sales revenue maximising output. True O Falsearrow_forwardSelect the appropriate label of each profit equation component on the graph. Note: On the graph below, click on Select drop-down lists. Dollars Profit Equation Components Select Select Select Select Select Volume Select Select oarrow_forward
- a. Find total revenues and marginal revenues for each of the quantities. b. What quantity of CDs would maximize profit? What would the price be? 2.) Charlies's lawn-mowing service is a profit-maximizing.competitive firm. Bob mows lawns for $27 each. His total cost each day is $280, of which $30 is a fixed cost. He mows 10 lawns a day. What can you say about Charlies's short-run decision regarding shutdown and his long-run decision regarding exit?arrow_forwardPierce Manufacturing determines that the daily revenue, in dollars, from the sale of x lawn chairs is R(x)=0.005x³ +0.02x² +0.5x Currently, Pierce sells 90 lawn chairs daily a) What is the current daily revenue? b) How much would revenue increase if 95 lawn chairs were sold each day? c) What is the marginal revenue when 90 lawn chairs are sold daily? d) Use the answer from part (c) to estimate R(91), R(92), and R(93) a) The current revenue is $ b) The revenue would increase by $ (Round to the nearest cent.) c) The marginal revenue is $ when 90 lawn chairs are sold daily. d) R(91) $ R(92) $ R(93) $arrow_forwardSolve it correctlyarrow_forward
- Many companies start with cost to determine price since revenue must cover cost for the firm to make a profit. True Falsearrow_forwardOn the graph input tool, change the number found in the Quantity Demanded field to determine the prices that correspond to the production of 0, 6, 12, 15, 18, 24, and 30 units of output. Calculate the total revenue for each of these production levels. Then, on the following graph, use the green points (triangle symbol) to plot the results. Calculate the total revenue if the firm produces 6 versus 5 units. Then, calculate the marginal revenue of the sixth unit produced. The marginal revenue of the sixth unit produced is________. Calculate the total revenue if the firm produces 12 versus 11 units. Then, calculate the marginal revenue of the 12th unit produced. The marginal revenue of the 12th unit produced is_________.arrow_forward3.3arrow_forward
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