Economics For Today
10th Edition
ISBN: 9781337613040
Author: Tucker
Publisher: Cengage Learning
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Question
Chapter 8, Problem 7SQ
To determine
The most-profitable level of revenue of the firm at price OB.
Expert Solution & Answer
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Check out a sample textbook solutionStudents have asked these similar questions
1) The cost curves for a firm in a perfectly competitive industry are given below. Complete the table.
If the firm operates in a perfectly competitive market, and the market price is $25 per unit, what Quantity should
this firm produce at?
TFC
TC
TVC
AVC
ATC
MC
TR
S100
S100
1
S100
S130
2
S100
S150
S100
S160
S100
S172
5
S100
S185
6
S100
$210
S100
$240
S100
$280
S100
$330
10
S100
$390
Table 9.1
Donald is a producer in the perfectly competitive market for cronuts - a pastry that is half croissant, half donut.
Total Fixed Cost
Total Variable Cost
Quantity
(cronuts)
TFC ($)
TVC ($)
125
5
125
10
10
125
18
15
125
32
20
125
52
25
125
82
If Donald's profit-maximising quantity is 20 cronuts, what is the market price per cronut at that quantity? Answer to the
nearest whole number (with no decimal places or $ sign).
A firm in a competitive market receives $500 in total revenue and has marginal revenue of $10. What is the average revenue, and how many units were sold?
Microeconomics - Mankiw
Chapter 8 Solutions
Economics For Today
Ch. 8.5 - Prob. 1YTECh. 8.5 - Prob. 2YTECh. 8 - Prob. 1SQPCh. 8 - Prob. 2SQPCh. 8 - Prob. 3SQPCh. 8 - Prob. 4SQPCh. 8 - Prob. 5SQPCh. 8 - Prob. 6SQPCh. 8 - Prob. 7SQPCh. 8 - Prob. 8SQP
Ch. 8 - Prob. 9SQPCh. 8 - Prob. 10SQPCh. 8 - Prob. 11SQPCh. 8 - Prob. 12SQPCh. 8 - Prob. 1SQCh. 8 - Prob. 2SQCh. 8 - Prob. 3SQCh. 8 - Prob. 4SQCh. 8 - Prob. 5SQCh. 8 - Prob. 6SQCh. 8 - Prob. 7SQCh. 8 - Prob. 8SQCh. 8 - Prob. 9SQCh. 8 - Prob. 10SQCh. 8 - Prob. 11SQCh. 8 - Prob. 12SQCh. 8 - Prob. 13SQCh. 8 - Prob. 14SQCh. 8 - Prob. 15SQCh. 8 - Prob. 16SQCh. 8 - Prob. 17SQCh. 8 - Prob. 18SQCh. 8 - Prob. 19SQCh. 8 - Prob. 20SQ
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Similar questions
- If a firm is producing at a quantity in which the marginal cost exceeds marginal revenue, the firm must decrease output to increase profit must increase output to increase profit is maximizing profit O must shut-down to increase profitarrow_forward1)A perfectly competitive firm produces 1000 units of burger in the long run. Themarginal revenue is RM6. Calculate this firm's marginal cost, average fixed cost, longrun average cost, total cost, total revenue, and total profit.arrow_forwardThe table below shows cost and revenue information for Choco Lovers, a purely competitive firm producing different quantities of chocolate gift boxes. Fill in the blanks in the table. Instructions: Enter your answers rounded to two decimal places. Quantity of Gift Boxes 20 25 30 35 40 45 b. Total revenue = Choco Lovers Cost and Revenue TC ($) ATC ($) 5.75 5.50 5.42 c. Profit = $ 227.50 d. Profit per unit = $ 115.00 137.50 162.50 192.50 232.50 282.50 Assume the profit-maximizing price is $8 per gift box, and then answer the following questions: a. Profit-maximizing quantity = 35 gift boxes 12 5.81 6.28 MC ($) per gift box 5.00 4.50 5.00 6.00 8.00 10.00arrow_forward
- Answer the question on the basis of the following demand and cost data for a specific firm. (1) Price $ 12.00 11.00 10.00 9.00 8.00 7.00 6.00 Demand Data (2) Price (3) Quantity $ 10.00 6 8.85 7 8.00 8 7.00 9 6.10 10 5.00 11 4.15 12 Multiple Choice $10.00. $9.00. Cost Data Output 6 7 8 9 10 11 12 If columns (1) and (3) of the demand data shown are this firm's demand schedule, the profit-maximizing price will be Total Cost $ 61 62 64 67 72 79 86arrow_forwardCalculate the amount of profit or loss made by this firm at the equilibrium output. State the type of profit.arrow_forwardCase D: Apex Company. Apex is a perfectly competitive firm. It has total fixed costs of $300/day and a daily variable cost schedule in the table below. Apex’s product sells for $200 per unit. Quantity (units) 0 1 2 3 4 5 6 7 8 9 10 Total Variable Cost (TVC) 0 100 180 220 300 390 500 640 800 1000 1250 Answer the following questions: What is the profit-maximizing level of output? Calculate Apex’s profit. If the market price dropped to $80, what is the profit-maximizing level of output? What is Apex’s profit (or loss) in this case? If the market price dropped further to $40, what is the profit-maximizing level of output? What is Apex’s profit (or loss) in this case? Comment on your answers to parts (2) and (3).arrow_forward
- The following figure shows the total cost and total revenue for a firm when it prices its products at $8 and $10. Price A 0 C H F JG 1. total fixed costs are OA. 2. economic profits equal BH. 3. average cost equals DG divided by OG. 4. total cost is minimized at B. TC TRO (P=$10) TR1 (P=$8) Output When the firm is producing the profit-maximizing level of output at a price of $10:arrow_forwardSuppose a firm in a competitive industry has the following cost curves: 10 9 8 7 6 5 4 3 2 1 Price + 1 + + + 2 3 4 5 MC ATC AVC P1 P2 P3 P4 + 6 7 8 Quantity Refer to Figure 14-13. If the price is P1 in the short run, what will happen in the long run? Nothing. The price is consistent with zero economic profits, so there is no incentive for firms to enter or exit the industry. Individual firms will earn positive economic profits in the short run, which will entice other firms to enter the industry. Individual firms will earn negative economic profits in the short run, which will cause some firms to exit the industry. Because the price is below the firm's average variable costs, the firms will shut down.arrow_forwardGiven the information in the table at right, calculate the dry cleaner's marginal revenue (MR) and marginal cost (MC) at each output level. (Your answer should be rounded to the nearest cent.) Total Output (Suits Cleaned) Suit ($) ($) Price Total per Costs Revenue (S) MC ($) MR ($) 8.00 3.00 0.00 1 7.50 6.00 7.50 7.00 8.50 14.00 6.50 10.50 19.50 4. 6.00 11.50 24.00 5.50 13.50 27.50 6 5.00 16.00 30.00 4.50 19.00 31.50 4.00 24.00 32.00 OOD OO O O O D O Oarrow_forward
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