Question

Rewrite these or use the attached Excel file and compute the missing cells. Gather graph paper and plot these coordinates for 3 curves: Qty v. ATC, Qty v. MC, Qty v. Price. Qty will be on the horizontal axis. All questions will refer to this graph. FC, VC, Price are given. The last row Qty 10 is calculated for you.

Qty	FC	VC	AVC	TC	ATC	MC	Price	TR	MR	Profit
0	$10						$6
1	10	7					6
2	10	12					6
3	10	16					6
4	10	20					6
5	10	23					6
6	10	27					6
7	10	32					6
8	10	39					6
9	10	49					6
10	10	63	6.3	73	7.3	14	6	60	6	-13

• Qty: Quantity to be produced in a batch
• FC: Fixed Cost (given) (rent)
• VC: Variable Cost (supplies/labor) (given) It may take a different amount of supplies/labor to make different size batches.
• AVC: Average Variable Cost (VC/Qty) Supplies/labor for each unit on avg.
• TC: Total Cost to make chosen Qty (including FC) FC+VC
• ATC: Average Total Cost (cost per unit on average) TC/Qty
• MC: Marginal Cost (additional cost to make that next unit)
• Price: Revenue per unit (given) For Perfect Competition, is the same as MR or D.
• TR: Total Revenue (incoming Revenue for the whole batch) Income
• MR: Marginal Revenue (additional revenue for that next unit) For Perfect Competition, is the same as Price. Not for Monopoly!
• Profit: Total profit made (TR-TC) Revenue minus expenses

Question 1 (1 point)

What is the Total Cost (TC) to make 2 units?

a	$22
b	$11
c	$12
d	$10

Question 2 (1 point)

What is the Average Total Cost (ATC) to make 7 units?

a	$4.57
b	$42
c	$5
d	$6

Question 3 (1 point)

What is the Marginal Cost (MC) to make the 6th unit?

a	$4.5
b	$10
c	$4
d	$6

Question 4 (1 point)

What is the Total Revenue for 7 units?

a	$42
b	$0
c	$32
d	$6

Answer 1