a) Given that Equilibrium price is $20, Profit maximizing level of output is 150 units, Average total cost is $25 and Average Variable Cost is $15 at this level of output, calculate Total Revenue, Total Cost, Total Fixed Cost, Profit/Loss. Should they continue production of shut down? Your answer b) Draw a diagram to show the above case.
Q: Consider the following data: equilibrium price is 9.50, the quantity of output produced is1,000…
A: It is given : Price= 9.50 Quantity of output produced = 1000 units Average total cost = 8 Average…
Q: A firm in a competitive market has the following cost structure as in the Figure 2 below. If the…
A: Fixed Cost = $3 Market Price = $10 Profit maximizing quantities can be found where, Total Revenue =…
Q: Suppose there is a decrease in the demand for high-definition televisions. What effect might this…
A: The demand curve shifts when there is a change in other factors other than price of commodity. If…
Q: What is meant by selling cost? Name one market where selling cost is applicable
A: Selling cost The overall expense made by a monopolistically competitive corporation in trying to…
Q: Which of the following statement(s) describe sunk cost? 1) All of the answers are correct 2) It…
A: To produce a good, two types of cost are incurred, variable cost and fixed or sunk cost.
Q: ATC AVC 0, Quantity Refer to Exhibit 22-4. The firm sells its product at P1 and produces Q1. Given…
A: find below the answer.
Q: A firm in a competitive market has the following cost structure: Output Total Cost 0 $5 1 $10…
A: Below is the complete table: Formula used: TR = P × QMR = TRn-TRn-1MC = TCn-TCn-1 Profit = TR - TC
Q: Amazing is evaluating three locations for a second headquarters. Costs for construction at location…
A: The break even point is a total cash inflow point, that would be equal and use the total cash…
Q: Construct a short-run supply schedule for the firm and indicate the profit or loss incurred at each…
A: Given information
Q: Table: Total Cost for a Perfectly Competitive Firm Quantity per Period Total Cost s10 16 2 20 3 22…
A: MC= TC2-TC1/Q2-Q1
Q: If the market for product "X" is an increasing cost industry, if there is a substantial increase in…
A: An industry is an increasing cost industry where average cost of production increases with increase…
Q: Answer the next question on the basis of the following cost data: Output Total cost 1 40 2 54 87 4…
A: Table attached below show the calculations for total revenue which is computed for each output by…
Q: For the following, decide whether you agree or dis-agree and explain your answer: a. A firm earning…
A: A perfect competition is the form of market that consist of large number of buyers and sellers,…
Q: Consider the following Table: Q TC 100 140 90 150 80 160 3 70 170 60 180 5 50 190 6. 40 200 30 210 8…
A: Average total cost or ATC is calculated by dividing total cost (TC) by quantity (Q). Marginal cost…
Q: Question 11 A firm that is suffering an economic loss in the short run should continue to operate as…
A: Short run refers to a period of time which is short enough that the firm cannot change its fixed…
Q: Product A cost $8 and demand for product B is 12 units then product A is reduced in price to $5 and…
A: Meaning of Price Elasticity of Demand: The price elasticity of demand refers to the situation…
Q: The following table provides information about long-run average cost curve of a firm: Quantity LRAC…
A: A firm is said to experience economies of scale when its average cost of producing each unit of…
Q: The total cost of producing 6 units of output is __________________ If the firm is producing at an…
A: Total Cost = Total Fixed Cost + Total Variable Cost Zero Economic Profit occurs when Total Revenue =…
Q: In general, a firm will stop production when the price no longer covers its fixed costs. True…
A: Answer to the question is as follows :
Q: Someone opens a dry cleaning business. He hires a business consultant to advise him on how to…
A: (1) For a perfectly competitive firm, P=SMC is the short-run supply equation. STC = 10 + Q + 0.1Q2…
Q: If the pandemic causes firms in a competitive industry to spend $100,000 per month on safety…
A: If the pandemic causes firms in a competitive industry to spend $100,000 per month on safety…
Q: A firm sells 1000 units per week. It charges $70 per unit, the average variable costs are $25, and…
A: Question: A firm sells 1000 units per week. It charges $70 per unit, the average variable costs are…
Q: When a firm maximizes profit in the short run, it should consider: all costs, including…
A: The short run is a period in which the time period is not long enough to make changes in all the…
Q: Currently the firm is producing at a profit maximizing quantity of output and has a total revenue of…
A: Marginal cost is the additional cost of producing one more unit of a good. Marginal revenue is the…
Q: MC ATC 11. Refer to the above graphs for a competitive market in the short run. Which of the…
A:
Q: Suppose that the long run TC function is as follows: TC=1000+10Q² (and total cost is 0 if Q is less…
A: Given, TC = 1000 + 10Q2MC = dTCdQ=20Q Price, P = 300
Q: A firm in a competitive market has the following cost structure: Quantity Total Cost (Units)…
A: Given Output Total cost(TC) Average cost Average variable cost Total revenue(TR) Profit = TR-TC…
Q: product for their firm. Marketers must understand break-even point calculations and sales targets.…
A: Formula: Profit = (Selling price*units sold) - (fixed cost + (variable cost * units sold)
Q: Question 2 Please aim to write approximately 400 words for text and graph analysis. Assume TX Bakery…
A: Dear student, you have asked multiple sub-part questions in a single post. In such a case, I will be…
Q: Construct a short-run supply schedule for the firm and indicate the profit or loss incurred at each…
A: We have to construct the supply schedule from the given unit cost data. We know that the supply…
Q: A snowboard company currently hires 10 skilled employees who are paid a weekly wage of $1,000. The…
A: When price is greater than marginal cost, it means that the producer would earn profits by selling…
Q: Assume that a firm in a competitive market faces the following cost information. If the market price…
A: Firms in perfect competition are price takers as there are a large number of firms selling identical…
Q: the effect of fixed costs upon AC as output increases the law of demand the law of constant…
A: increasing and decreasing returns to scale
Q: Problem # 1 Demand for a firm’s product is: P = 140 - 6Q. The firm’s cost equation is: C = 300 +…
A: Firm will produce at the output level where MC =MR in order to attain maximum profit.
Q: A firm has the long-run cost function CQ) = 4Q + 64.In the long run, it will supply a positive…
A: The long-run cost curve is a cost function that models this minimum cost over time, meaning inputs…
Q: Claude’s Copper Clappers sells clappers for $65 each in a perfectly competitive market.
A: As per answering guidelines, should answer only first question.
Q: Mr DIY is a new small scale palm oil supplier. There are many small scale palm oil suppliers in the…
A: Creation of palm oil that conforms to willful maintainability guidelines is developing at a quicker…
Q: If profit is maximum at sales of 700 units, does the firm have no choice but to limit sales at this…
A: Hi! thanks for the question but as per the guidelines, we can answer only one question at one time.…
Q: Assume the following total cost schedule for a perfectly competitive firm Output TVC (S) TFC (S) 100…
A: ATC is determined by partitioning total cost by the absolute amount delivered. The ATC bend is…
Q: Refer to Scenario 14-2. To maximize its profit, the firm should increase its output. continue to…
A: Perfect competition is a market structure where a single firm has no effect on the price of the…
Q: Lakes region in New York State produces wine. The climate favors white wines, but reds have been…
A: A fixed cost is the cost that does not change with output. It remains fixed throughout the period…
Q: (MANAGERIAL ECONOMICS) Show algebraic solution please Assume that B = -Q 2 + 4,500Q and C= 2Q 2…
A: Given, B = -Q 2 + 4,500Q C= 2Q 2 A. Profit is the difference between the benefits and the cost.…
Q: A company's short run total cost function is given by TC(q) = 3.0q^(3) - 1.0q^(2) + 3.6q + 3.…
A: In the short run there exists fixed cost which does not depend on output. The production decision…
Q: When you calculate marginal costs, they should include: SELECT THE CORRECT ANSWER A.the market…
A: Fixed Cost: It is the cost that is incurred for purchasing fixed factors of production. It is…
Q: TRUE OR FALSE 1. A firm suffering loss in the short run will continue to operate as long as total…
A: Revenues are the most important element that helps the business organization running for a long…
Q: In the short run, a firm will produce a positive amount of output as long as _____ Group of answer…
A: In short run, the firm will produce the goods as long as the price greater than the average variable…
Step by step
Solved in 2 steps with 1 images
- (a) Calculate this firm’s marginal cost for output level 5. (b) Calculate this firm’s marginal cost for output level 6. (c) What is the average total cost at which, this firm reaches its break even-point? (d) What is the average variable cost at which, this firm reaches its shut-down point?PROBLEM 2. Answer the questions below on the basis of the diagram. $10 MC ATC 9 AVC 7 3 2 1 1 2 3 4 6. 7 8 9 10 Quantity (in 1,000s) (a) How can you tell if these cost curves are for the short run or the long run? (b) What does the graph indicate about: (1) AVC at 6000 units of output? (2) ATC at 6000 units of output? (3) AFC at 6000 units of output? (4) TVC at 6000 units of output? (5) TFC at all levels of output? (6) TC at 10,000 units of output? (7) When diminishing returns set in? Cost per unit2. Calculate the values of A, B, C, and D in the following table. Show your calculations. Price Marginal cost Markup on cost Markup on price (%) (%) 6,250 A 5.3 B C 10,000 D 0.0
- 1. Mariel runs an ice cream shop. Her short-run cost is given by 300 + is the number of ice cream cones she sells per day. + 3q where q 3000 (a) Find mathematical expressions for Mariel's marginal cost, average variable cost, and average total cost. (b) Sketch' Mariel's marginal cost, average variable cost, and average total cost. (c) Suppose the market price for ice cream cones is $3. How many ice cream cones will Mariel supply? What will her profits be? Identify your answers on the diagram and then compute the values mathematically. (d) Find the minimum market price such that Mariel will stay in business in the short-run, both on your diagram and mathematically. (e) Assume that Mariel can only run an ice cream shop of this size and in the long run must decide whether to operate or not. (In other words, assume that Mariel's LRAC curve is her short-run average total cost curve.) Identify the minimum market price such that Mariel will stay in business in the long-run on your diagram.…Consider total cost and total revenue given in the following table: TABLE IN IMAGE Calculate profit for each quantity. How much should the firm produce to maximize profit?(ii) Calculate marginal revenue and marginal cost for each quantity. Graph them. (Hint: Put the points betweenwhole numbers. For example, the marginal cost between 2 and 3 should be graphed at 2½.) At what quantitydo these curves cross? How does this relate to your answer to part (a)?(iii) Can you tell whether this firm is in a competitive industry? If so, can you tell whether the industry is in along-run equilibrium? (8.75)1. Marginal revenue and its below average total cost? Take an example 2. How costs change when fixed and variable costs change ? Take an example 3. Graphical impact on cost changes on marginal and average costs?.Take an example
- QUESTION 9 John lives in the small island nation of Vanuatu, and is a producer in the perfectly competitive market for galip nuts. A summary of some of his costs, which are given in the local currency (the "vatu"), is shown below. Quantity (kg of galip nuts) 0 30 60 90 120 150 Total Fixed Cost TFC (vatu) 5600 5600 5600 5600 5600 5600 Total Variable Cost TVC (vatu) 0 640 1520 2640 4800 9120 If John's profit-maximising quantity is 90kg of galip nuts, what is the marginal revenue per kilogram of galip nuts at this profit maximising quantity? Answer to the nearest whole number.1. Suppose a firm’s cost function is given by C(q) = 20 + 10q − 4q^2 + q^3(a) What is fixed cost?(b) What is variable cost?(c) Compute average cost, average fixed cost, and average variable cost, assuming q > 0.(d) Derive marginal cost.(e) Solve for the shut-down level of production, qSD. (Hint: The minimum of a well-behavedcurve can be found by setting the first derivative equal to zero.)A firm in a perfectly competitive industry has fixed costs of FC = 15, marginal costs of MC = 5 + 14q, and average variable costs of AVC = 5 + 7q. (a) What are the firm’s variable costs (VC)? (b) What is the firm’s total cost function? (c) If the price is $75, how much does the firm supply? (d) Does the firm continue to supply this quantity in the short-run? (e) Suppose there exists a standard market demand function from consumers (downward slopping). Please provide a logical discussion about how the market achieves short-run equilibrium.
- of 5. The maximum value of profit is -$22 which occurs at a value Q=4. Fixed costs are $30. (a) Find the equation. (b) Graph. (c) What would you advise this firm to do in the short-run and in the long-run?Fixed cost is $100 per day.Suppose that the price at which Katie can sell catered meals is $21 per meal. In the short run, will Katie earn a profit? If yes, what is the amount of economic profit? (c) What is the break-even price and the shut-down price in the short run? (d) Suppose that the price at which Katie can sell catered meals is $13 per meal. In the short run, will Katie earn a profit? In the short run, should she produce or shut down?1. Consider a firm with the following cost and inverse demand functions. Cost($) 20 3 Cost Function N 3 quantity Price($) 16 13 30 10 Inverse Demand quantity (a) What are the average costs of producing 1, 2, and 3 units for this firm? (b) What are the marginal costs of producing first, second, and third units for this firm? (c) Does this firm enjoy either economies or diseconomies of scale? (d) What are the profits of producing 1, 2, and 3 units for this firm? (e) When does the firm maximize its profit? Select from producing 1, 2, and 3 units.