Question

The next series of questions uses the following table. The table contains 5 columns: Quantity Q, Price P, Total Revenue TR, Total Cost TC, and Total Profit. You are given the numbers for the 1st, 2nd, and 4th columns and must find the numbers for the 3rd column (Total Revenue) and the 5th column (Total Profit). I suggest completely filling out the table on a piece of paper. First, calculate total revenue at a quantity of 2.

Quantity Q	Price P	Total Revenue TR	Total Cost TC	Total Profit
0	$200		$20
1	$180		$110
2	$160		$140
3	$140		$160
4	$120		$190
5	$100		$230
6	$80		$270
7	$60		$330

Calculate total revenue at a quantity of 6.

Using the previous table, calculate total profit at a quantity of 1.

Calculate total profit at a quantity of 5.

Using the previous table, what is the highest profit possible? Note that this question and the next few questions depend on your ability to accurately find the highest profit possible. So, be very careful with this.

Answer 1

Q	P	TR = P*Q	TC	Profit = TR - TC
0	200	0	20	0-20 = -20
1	180	1*180 = 180	110	180-110 = 70
2	160	2*160 = 320	140	320-140 = 180
3	140	3*140 = 420	160	420-160 = 260
4	120	4*120 = 480	190	480-190 = 290
5	100	5*100 = 500	230	500-230 = 270
6	80	6*80 = 480	270	480-270 = 210
7	60	7*60 = 420	330	420-330 = 90

Total revenue at a quantity of 2 = $320

Total revenue at a quantity of 6 = $480

Total profit at a quantity of 1 = $70

Total profit at a quantity of 5 = $270

The highest profit possible is $290 at a quantity of 4.