Consider a company with the following cost and revenue information: ATC = $80, AVC = $70,...
Consider a company with the following cost and revenue information: ATC = $80, AVC = $70, and MR = MC = $90. If the firm produces Q = 600 in the short run, it:
Group of answer choices
A. is minimizing losses.
B. makes a total loss of $6000.
C. should produce more output.
D. is making a mistake and should shut down.
E. is maximizing total profit.
Homework Answers
Answer
Option E
E. is maximizing total profit.
the firm is maximizing profit as the MR=MC is means the profit is maximum
also, the MR>ATC means the profit is maximum and not loss is minimum because the firm is making profit
Even, we don't know the firm is in perfect competition or imperfect competition but the P equal to or higher than the MR
so the firm is making a minimum profit of
Profit =(P-ATC)*Q
=(90-80)*600=$6000
the firm is making a minimum profit of $6000
Add Answer to:
Consider a company with the following cost and revenue
information: ATC = $80, AVC = $70,...
1) A perfectly competitive firm faces the following Total revenue, Total cost and Marginal cost functions:...
1) A perfectly competitive firm faces the following Total revenue, Total cost and Marginal cost functions: TR = 10Q TC = 2 + 2Q + Q2 MC = 2 + 2Q At the level of output maximizing profit , the above firm's level of economic profit is A) $0 B) $4 C) $6 D) $8 *Additional information after I did the math: The price this firm charges for its product is $10, the level of output maximizing profit is 4...
MC Cost and Revenue ATC MR AVC o '1'2'3'4'56'58' Quantity 10 a. (1 points) Using the...
MC Cost and Revenue ATC MR AVC o '1'2'3'4'56'58' Quantity 10 a. (1 points) Using the graph above, what is the profit maximizing or loss minimizing output and price? b. (1 point)Using the graph above, what is the profit or loss at the profit maximizing or loss minimizing point c. (1 point) What is the shutdown price and quantity?
Help with 14-16 please. 14. A Monopoly: A. Will realize an economic profit if price exceeds...
Help with 14-16 please.
14. A Monopoly: A. Will realize an economic profit if price exceeds ATC at the profit-maximizing/loss-minimizing level of output. B. Will realize an economic profit if ATC exceeds MR at the profit-maximizing/loss-minimizing level of output c. Will realize an economic loss if MC intersects the down-sloping portion of MR D. Always realizes an economic profit. MC ATC AVC 15. At equilibrium, the profit-maximizing monopolist facing the situation shown in the graph above will face: A. Average...
The following graph shows the demand and cost curves for a perfectly competitive firm. The profit-maximizing...
The following graph shows the demand and cost curves for a perfectly competitive firm. The profit-maximizing firm will: MC ATC // AVC Multiple Choice shut down. ο produce with short-run losses. O produce with long-run economic profits. ο produce with short-run economic profits.
ATC AVC 60 80 100 Figure 9.2 Figure 9.2 shows the cost structure of a firm...
ATC AVC 60 80 100 Figure 9.2 Figure 9.2 shows the cost structure of a firm in a perfectly competitive market. Suppose the current market price is $10 and the firm produces the profit maximizing output level. If the firm's total fixed cost increases due to a new government regulation, the short-run response of the firm should be to: Note: since the question does not restrict the firm's response to the short run, we can't rule out that the rise...
Answer A-H Please Answer the following Questions for a Monopoly Firm. Price Quantity TR MR MC...
Answer A-H Please Answer the following Questions for a Monopoly Firm. Price Quantity TR MR MC TC Profit $15,000 0 ---- ---- $50,000 14,000 1 $52,000 13,000 2 $53,000 12,000 3 54,000 11,000 4 $2,000 10,000 5 59,000 9,000 6 4,000 8,000 7 $69,000 7,000 8 $8,000 6,000 9 5,000 10 4,000 11 $18,000 3,000 12 $143,000 a) Fill in the missing information above for this Monopoly Firm for its monthly production. Note there are no numbers for MC and...
In the short run, a perfectly competitive firm is producing where MR-MC. At this output, P>AVC...
In the short run, a perfectly competitive firm is producing where MR-MC. At this output, P>AVC and P>ATC. This firm A) is making positive economic profits B) is making zero economic profits C) is making negative economic profits but should continue to operate D) is making negative economic profits and should shut down.
$ per unit MC ATC MR $40 AVC $20 2 4 6 8 10 12 Output (9) The graph above shows a firm's Marginal Revenue (MR), M...
$ per unit MC ATC MR $40 AVC $20 2 4 6 8 10 12 Output (9) The graph above shows a firm's Marginal Revenue (MR), Marginal Cost (MC), Average Total Cost (ATC) and Average Variable Cost (AVC). This firm is a profit-maximizing price taker. Find the firm's short run shutdown price. (Do not include a S sign in your response. Round to the nearest two decimal places if necessary.) Answer: Check
Exhibit 7-17 Marginal revenue and cost per unit curves DMC ATC Price and costs per unit...
Exhibit 7-17 Marginal revenue and cost per unit curves DMC ATC Price and costs per unit (dollars) AVC 0 20 100 40 60 80 Quantity of output (units per day) 16. As shown in Exhibit 7-17, the price at which the firm earns zero economic profit in the short-runis a. $10 per unit. b. $15 per unit. c. $40 per unit. d. more than $20 per unit. e. $20 per unit. 17. In long-run equilibrium, the typical perfectly competitive firm...
3. The following graph shows the cost and revenue curves for a firm in a perfectly...
3. The following graph shows the cost and revenue curves for a firm in a perfectly competitive market. 90 80 D=MR 70 60 ATC Price and cost ($) 50 AVC 40 30 MC 20 10 0 10 20 30 40 50 60 70 80 90 a) Assume that new firms enter this market and that drives the price down to $35 per unit. Will the firm continue to produce or shut down? Explain your answer.
MC Cost and Revenue ATC MR AVC o '1'2'3'4'56'58' Quantity 10 a. (1 points) Using the graph above, what is the profit maximizing or loss minimizing output and price? b. (1 point)Using the graph above, what is the profit or loss at the profit maximizing or loss minimizing point c. (1 point) What is the shutdown price and quantity?
Help with 14-16 please.
14. A Monopoly: A. Will realize an economic profit if price exceeds ATC at the profit-maximizing/loss-minimizing level of output. B. Will realize an economic profit if ATC exceeds MR at the profit-maximizing/loss-minimizing level of output c. Will realize an economic loss if MC intersects the down-sloping portion of MR D. Always realizes an economic profit. MC ATC AVC 15. At equilibrium, the profit-maximizing monopolist facing the situation shown in the graph above will face: A. Average...
The following graph shows the demand and cost curves for a perfectly competitive firm. The profit-maximizing firm will: MC ATC // AVC Multiple Choice shut down. ο produce with short-run losses. O produce with long-run economic profits. ο produce with short-run economic profits.
ATC AVC 60 80 100 Figure 9.2 Figure 9.2 shows the cost structure of a firm in a perfectly competitive market. Suppose the current market price is $10 and the firm produces the profit maximizing output level. If the firm's total fixed cost increases due to a new government regulation, the short-run response of the firm should be to: Note: since the question does not restrict the firm's response to the short run, we can't rule out that the rise...
In the short run, a perfectly competitive firm is producing where MR-MC. At this output, P>AVC and P>ATC. This firm A) is making positive economic profits B) is making zero economic profits C) is making negative economic profits but should continue to operate D) is making negative economic profits and should shut down.
$ per unit MC ATC MR $40 AVC $20 2 4 6 8 10 12 Output (9) The graph above shows a firm's Marginal Revenue (MR), Marginal Cost (MC), Average Total Cost (ATC) and Average Variable Cost (AVC). This firm is a profit-maximizing price taker. Find the firm's short run shutdown price. (Do not include a S sign in your response. Round to the nearest two decimal places if necessary.) Answer: Check
Exhibit 7-17 Marginal revenue and cost per unit curves DMC ATC Price and costs per unit (dollars) AVC 0 20 100 40 60 80 Quantity of output (units per day) 16. As shown in Exhibit 7-17, the price at which the firm earns zero economic profit in the short-runis a. $10 per unit. b. $15 per unit. c. $40 per unit. d. more than $20 per unit. e. $20 per unit. 17. In long-run equilibrium, the typical perfectly competitive firm...
3. The following graph shows the cost and revenue curves for a firm in a perfectly competitive market. 90 80 D=MR 70 60 ATC Price and cost ($) 50 AVC 40 30 MC 20 10 0 10 20 30 40 50 60 70 80 90 a) Assume that new firms enter this market and that drives the price down to $35 per unit. Will the firm continue to produce or shut down? Explain your answer.
Most questions answered within 3 hours.
-
Although Epicurus advocates pursuing pleasure for the
good life, discuss a few reasons why he does...
asked 8 minutes ago -
Problem 1: Present entries to record the selected transactions
described below:
(a)
Issued $2,790,000 of 5-year,...
asked 14 minutes ago -
Using technology to support HR activities increases:
a.
the efficiency of the administrative HR functions.
b....
asked 15 minutes ago -
1. List the features used to classify leaf
types.
2. List some characteristics that are shared...
asked 20 minutes ago -
The three elements of Value Proposition, Key Customers, and
Capabilities operate within an environment. Which of...
asked 22 minutes ago -
Katelynn, a physician, earns $200,000 from her medical practice
in the current year. She receives $45,000...
asked 30 minutes ago -
Each row of the table below describes an aqueous solution at
25°C
.
The second column...
asked 34 minutes ago -
A horizontal wire is at y = 0. Current travels in the +x
direction. The magnetic...
asked 35 minutes ago -
Let X be a continuous random variable whose PDF is Let X be a
continuous random...
asked 56 minutes ago -
Martinez Company’s relevant range of production is 7,500 units
to 12,500 units. When it produces and...
asked 54 minutes ago -
A football with a mass of 1.2 kg is kicked from ground level to
a height...
asked 1 hour ago -
Remember: Changes in supply determinants shift supply, and
changes in demand determinants shift demand. We say...
asked 58 minutes ago