Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 8, Problem 40P
The total variable costs are
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Table A
Unit
Marginal
Cost
Marginal
Revenue
Quantity
12
$5.00
$9.00
13
$6.00
$9.00
14
$7.00
$9.00
15
$8.00
$9.00
16
$9.00
$9.00
17
$10.00
$9.00
This table describes the relationship between output, marginal revenue, and marginal cost. If the firm is
currently producing 14 units, what would you advise them to do?
decrease quantity to 13
) increase quantity to 15
remain at 14 units
increase quantity to 16 units
Total
Revenue
Total C ost
Proit/Loss/
Price( P)
Quantity
(TR)
(TC)
Break Even
$3
5.
2
9.
3
8.
4
11
5.
15
6.
21
30
8.
42
6.
60
10
85
Yummy Cupcakes is a purely competitive firm. The firm's costs are shown in the table above. The market price is $5 (USE THIS TO FILL IN
THE PRICE COLUMN) When Yummy Cupcakes produces 1 cupcakel Q-1).the firm :
O breaks even
incurs a loss
O earns profits
will shutdown
1) Given the following cost and revenue schedule, find the profit-maximizing quantity. Calculate total profits,
average cost and average revenue..
Quantity
0
10
20
30
40
50
60
70
Total Cost
400
500
625
775
950
1150
1375
1625
Total Revenue
0
600
900
1150
1350
1500
1600
1650
2) Plot the total revenue curve, total cost curve.
3) Given the cost and revenue schedule above, find the profit-maximizing quantity. Calculate the marginal cost and
marginal revenue."
4) Plot the marginal cost curve and marginal cost curve. Apply the profit maximizing rule in the short-run. (
Chapter 8 Solutions
Principles of Economics 2e
Ch. 8 - Firms ill a perfectly competitive market are said...Ch. 8 - Would independent trucking fit the characteristics...Ch. 8 - Look at Table 8.13. What would happen to the films...Ch. 8 - Suppose that the market price increases to 6, as...Ch. 8 - Explain in words why a profit-maximizing film will...Ch. 8 - A firms marginal cost curve above the average...Ch. 8 - If new technology in a perfectly competitive...Ch. 8 - A market in perfect competition is in long-run...Ch. 8 - Productive efficiency and allocative efficiency...Ch. 8 - Explain how the profit-maximizing rule of setting...
Ch. 8 - A single firm in a perfectly competitive market is...Ch. 8 - What are the four basic assumptions of perfect...Ch. 8 - What is a price taker firm?Ch. 8 - How does a perfectly competitive firm decide what...Ch. 8 - What prevents a perfectly competitive firm from...Ch. 8 - How does a perfectly competitive film calculate...Ch. 8 - Briefly explain the reason for the shape of a...Ch. 8 - What two rules does a perfectly competitive firm...Ch. 8 - How does the average cost curve help to show...Ch. 8 - What two lines on a cost curve diagram intersect...Ch. 8 - Should a firm shut down immediately if it is...Ch. 8 - How does the average variable cost curve help a...Ch. 8 - What two lines on a cost curve diagram intersect...Ch. 8 - Why does entry occur?Ch. 8 - Why does exit occur?Ch. 8 - Do entry and exit occur in the short run, the long...Ch. 8 - What price will a perfectly competitive firm end...Ch. 8 - Will a perfectly competitive market display...Ch. 8 - Will a perfectly competitive market display...Ch. 8 - Finding a life partner is a complicated process...Ch. 8 - Can you name five examples of perfectly...Ch. 8 - Your company operates in a perfectly competitive...Ch. 8 - Since a perfectly competitive firm can sell as...Ch. 8 - Many films in the United States file for...Ch. 8 - Why will profits for films in a perfectly...Ch. 8 - Why will losses for firms in a perfectly...Ch. 8 - Assuming that the market for cigarettes is in...Ch. 8 - In the argument for why perfect competition is...Ch. 8 - The AAA Aquarium Co. sells aquariums for 20 each....Ch. 8 - Perfectly competitive firm Doggies Paradise Inc....Ch. 8 - A computer company produces affordable,...
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