Question
1) Answer the following question based on the chart below: Q Price Total Cost Fixed Cost...
1) Answer the following question based on the chart below:
|
Q |
Price |
Total Cost |
Fixed Cost |
Total Variable Cost |
Marginal Cost |
Profit |
|
0 |
$8 |
$12 |
-- |
- |
-$12 |
|
|
1 |
$8 |
3 |
||||
|
2 |
$8 |
4 |
||||
|
3 |
$8 |
12 |
||||
|
4 |
$8 |
18 |
||||
|
5 |
$8 |
10 |
The optimal amount for this firm to produce in the short run is? When would the firm shut-down in the short-run (i.e. at what price)? What if the price of the good was $5? What would the firm do if the price fell to $2?
Make sure you fill in the tables to answer the question … but explain WHY you got the numbers you did.
Homework Answers
Answer #1
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