Question

Given the following information for a restaurant, what is this firm's ATC, MC and TC at Q = 0, 1, 2, 3, and 4?

Building lease = $600

Interest owner could have earned on funds invested in business = $400

Food per meal = $500 / meal

Servers for each meal = $400/ meal

Time owner spends at each meal = $100/meal

Answer #1

The excel calculation and formula used are shown below:

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Given the following information for a restaurant, what is this
firm's ATC, MC and TC at Q = 0, 1, 2, 3, and 4?
Building lease = $600
Interest owner could have earned on funds invested in business =
$400
Food per meal = $500 / meal
Servers for each meal = $400/ meal
Time owner spends at each meal = $100/meal

Given the following information for a restaurant, what is this
firm's ATC, MC and TC at Q = 0, 1, 2, 3, and 4?
Building lease = $600
Interest owner could have earned on funds invested in business =
$400
Food per meal = $500 / meal
Servers for each meal = $400/ meal
Time owner spends at each meal = $100/meal

Complete the following table.
Output
MC
VC
FC
TC
ATC
AFC
AVC
ATC-AVC
0
$6,000
100
$10
200
$2,500
300
$10,500
400
$36.25
500
$45
600
$20,000
You know several relationships among these variables that will
allow you to check your work. For example,
AFC decreases as Q increases.
AVC approaches ATC from below as output increases.

Given the following information about a firm’s costs,
complete the following chart. Graph the TC, TFC and TVC on one
graph and directly below it (stack) a graph with the ATC, AFC, AVC
& MC.
Q
TC
TFC
TVC
ATC
AFC
AVC
MC
0
$2,500
--
25
20.00
50
$900
75
$49.33
100
15.00
125
$2,000
150
$5,050
175
$32.29
200
19.00

Given the following information about a firm’s costs,
complete the following chart. On one graph, show the TC, TFC and
TVC. On a separate graph, show the AFC, AVC, ATC, and
MC. You may use graph paper for this
question.
Q
TC
TFC
TVC
ATC
AFC
AVC
MC
0
--
50
10.00
100
9.00
150
8.00
200
12.00
7.00
250
6.00
300
7.00
350
8.00
400
9.00

Jin Ramen is a restaurant on Broadway. Jin Ramen’s
daily Total Costs is TC =q^2/100 + 20q + 400. Where q is the number
of meals served each day.
In the evening, customers are willing to pay up to $25 for a
meal, while at lunch they do not want to spend more than $15.
Should the restaurant remain open for business at lunch-time?
Why?
If the restaurant wants to maximize profits, how many meals
should it serve each day?...

Assume a firm's cost function is given by the following
equation; TC = 100q + 100q^2.
a. Calculate the firms's MC function.
b. What is the firm's AC function?
Some cost structures allow for decreasing average costs as the
level of production increases for the firm. For example, a firm
that purchases a $10,000 machine will calculate an average cost of
$10,000 if it only produces one unit of its product ($10,000/1 =
$10,000). However if the firm produces 100...

Table 1. Use the information to calculate the following
TC, AFC, AVC, ATC, AND MC (I through 50)
TP
TFC
TVC
TC
AFC
AVC
ATC
MC
150
0
(1)
(11)
(21)
(31)
(41)
2
150
70
(2)
(12)
(22)
(32)
(42)
3
150
130
(3)
(13)
(23)
(33)
(43)
4
150
240
(4)
(14)
(24)
(34)
(44)
5
150
300
(5)
(15)
(25)
(35)
(45)
6
150
360
(6)
(16)
(26)
(36)
(46)
7
150
390
(7)
(17)
(27)
(37)...

Q
TC
MC
TR
AVC
ATC
Total Profit or Loss
0
3750
---
0
---
---
-3750
250
7500
3750
500
8500
7500
9.50
17.00
-1000
750
9000
11250
1000
10250
15000
6.50
10.25
4750
1250
12875
10.50
18750
7.30
10.30
1500
16500
14.50
22500
8.50
1750
21625
20.50
26250
10.21
12.36
4625
2000
28125
26.00
30000
12.91
14.06
1875
Given the above table, which shows the weekly production
information for bushels of soybeans, complete the following:
1) Complete the...

Given the following information for a monopolistic
competitor:
Demand: P = 68 – 7(Q)
Marginal revenue: MR = 68 – 14(Q)
Marginal cost: MC = 2(Q) + 8
Average total cost at equilibrium is 22
1. At what output (Q) will this firm maximize
profit?
2. At what price (P) will this firm maximize
profit?
3. What is the total revenue (TR) earned at this output
level?
4. What is the total cost (TC) accrued at this
output?
5. What...

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