Question

Complete the following cost and revenue schedule

Average

Quantity Total Marginal Total Marginal Total

Price Demanded Revenue Revenue Cost Cost Cost

$20 0 $8

$18 1 $14

$16 2 $22

$14 3 $32

$12 4 $44

$10 5 $58

$8 6 $74

$6 7 $92

$4 8 $112

$2 9 $147

a. Graph the demand, MR, and MC curves.

b. At what rate of output are profits maximized within this range?

c. What are the values of MR and MC at the profit-maximizing rate of output?

d. What are total profits at that output rate?

e. If a competitive industry confronted the same demand and costs, how much output is produced in the short run?

f. What would happen to long-run price in perfect competition?

Answer #1

Complete the following cost and revenue schedule:
Price
Quantity Demanded
Total Revenue
Marginal Revenue
Total Cost
Marginal Cost
Average Total Cost
20
0
8
18
1
14
16
2
22
14
3
32
12
4
44
10
5
58
8
6
74
6
7
92
4
8
112
2
9
147
a. Graph the demand, MR, and MC curves.
b. At what rate of output are profits maximized within this
range?
c. What are the values of MR and MC...

Suppose you are given the following table:
Output
Price
Total Cost
Total Revenue
Marginal Revenue
Marginal Cost
Average Total Cost
Profit/
Loss
(P-ATC)
0
150
100
1
138
150
2
125
184
3
113
208
4
100
227
5
88
250
6
75
280
7
63
318
8
50
366
9
38
425
10
25
500
a. Determine the optimum /profit maximizing point using the
MR-MC Principle
b. At this point, what are the total profits?
c. Calculate (Price -...

The reason price equals marginal revenue in a competitive market
is that:
the law prohibits marginal revenue from diverging from market
price.
marginal revenue always is equal to marginal cost.
since price is constant, the added revenue from selling one more
unit is the price.
consumer advocacy groups maintain a steady price.
If MR is greater than MC, then:Which of the following statements
regarding marginal revenue for a competitive firm is correct?
It is never used to determine a firm's...

A monopolist faces the following demand curve, marginal
revenue curve, total cost curve and marginal cost curve for its
product: Q = 200 - 2P
MR = 100 - Q
TC = 5Q MC = 5
a. What is the profit maximizing level of output?
b. What is the profit maximizing price? c. How much profit
does the monopolist earn?

The following equations describe the monopolist’s demand,
marginal revenue, total cost and marginal cost:
Demand: Qd = 12 – 0.25P | Marginal Revenue: MR = 48 – 8Q | Total
Cost: TC = 2Q^2 | Marginal Cost: MC = 4Q
Where Q is quantity and P is the price measured in dollars.
a) What is the profit maximizing monopoly’s quantity and
price?
b) At that point, calculate the price elasticity of demand. What
does the value imply?
c) Does this...

Toyota produces a certain aftermarket part for their vehicle
line with the following estimated demand function,
Q=140,000-12,000P Q is quantity demanded per year and P is price
charged. Toyota was able to say their fixed costs for this product
are $11,000 and variable costs are $1.75 per unit. A. Write the
total revenue function. B. Determine the marginal revenue. C. Write
the total cost function. D. Solve for marginal cost. E. Write an
equation for total profits. At what price...

Q 6
Given the following data.
Quantity
0
1
2
3
4
5
6
7
8
Price
8
8
8
8
8
8
8
8
8
Total cost
8
20
23
24
32
40
48
56
64
(a) Generate the following information; Total Revenue (TR),
Marginal Revenue (MR), Average Revenue (AR), Marginal Cost (MC),
Average Cost (AC) and Total profits at each level of output.
(b) Draw the graphs of the Total Revenue and Total Cost, at what
point is...

Suppose that the monopolist’s demand is: P = 10 – Q, so that
marginal revenue is: MR = 10 – 2Q.
The marginal cost is: MC = 2, and total fixed cost = 0.
a. Determine the profit maximizing price and output.
b. Calculate the amount of economic profit or loss at the profit
maximizing output.
c. Calculate the price elasticity of demand at the profit
maximizing point and explain it.
use relevant diagram to answer the question

For the following firm in a competitive market,
COSTS
REVENUES
Quantity
Produced
Total
Cost
Marginal
Cost
Quantity
Demanded
Price
Total
Revenue
Marginal
Revenue
0
$0
--
0
$80
--
1
$50
1
$80
2
$102
2
$80
3
$157
3
$80
4
$217
4
$80
5
$285
5
$80
6
$365
6
$80
7
$465
7
$80
8
$585
8
$80
Fill the column for marginal cost, total revenue and marginal
revenue.
What is interesting about the numbers you find...

In the following table are demand
and cost data for a pure monopolist.
Complete the table by filling in the
columns for total revenue, marginal revenue, and marginal cost.
Answer these three questions: (a)
what output will the monopolist produce? (b) What price will the
monopolist charge? (c) What total profit will the monopolist
receive at the profit-maximizing level of output?
Total
Marginal
Total
Marginal
Quantity
Price
revenue
revenue
cost
cost
0
$34
$______
$ 20
...

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