Homework Answers
Answer
3 units
the firm produces at MR=MC if the P>minimum average varible cost and the MR=$16 =P as the MR is constant
so the firm produces 3 units at MR=MC level of output.
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Refer to the data below. If the firm's minimum average variable cost is $10, the firm's...
The graph below shows the marginal, average variable, and average total cost curves for a perfectly...
The graph below shows the marginal, average variable, and average total cost curves for a perfectly competitive firm. Refer to the graph to answer the following questions. Instructions: Indicate the profit-maximizing level of output. Enter your response as a whole number. Price and cost MC ATC AVC $40.50 36.00 30.00 MR 22.00 20.00 130 180 240 Quantity a. What is the amount of the fixed cost of production? $ b. Suppose the market price is $30 what is the firm's...
The graph below shows the marginal, average variable, and average total cost curves for a pizza...
The graph below shows the marginal, average variable, and average total cost curves for a pizza seller. Refer to the graph to answer the following questions. Instructions: Indicate the profit-maximizing level of output. Enter your response as a whole number. Cost Curves 3.50 3.25 3.00 2.75 Select Select Select 2.50 (S/slice) 2.00 W 1.75 1.50 1.25 1.00 0.75 0.50 0.25 100 200 300 400 500 600 700 800 900 Q -> Quantity (slices/day) a. What is the amount of the...
15. When marginal cost is less than average total cost, a. marginal cost must be falling....
15. When marginal cost is less than average total cost, a. marginal cost must be falling. b. average variable cost must be falling. c. average total cost is falling. d. average total cost is rising. 16. Which of the following is not a characteristic of a competitive market? a. Buyers and sellers are price takers. b. Each firm sells a virtually identical product. c. Entry is limited d. Each firm chooses an output level that maximizes profits. 17. If a...
14. Refer to Figure 13-8. Which of the following statements is correct? a. Marginal cost is...
14. Refer to Figure 13-8. Which of the following statements is correct? a. Marginal cost is rising for quantities higher than D because marginal cost is higher than average total cost. b. Average variable cost is declining for quantities less than B because marginal cost is lower than average variable cost. c. Marginal cost is minimized at B because at that quantity, marginal cost equals average variable cost. d. All of the above are correct. 15. When marginal cost is...
The minimum wage is an example of O a price ceiling. O a price floor. O...
The minimum wage is an example of O a price ceiling. O a price floor. O a wage subsidy O a tax. Suppose that a firm is currently maximizing its short-run profit at an output of 50 units. If the current price is $9, the marginal cost of the 50th unit is $9, and the average total cost of producing 50 units is $4, what is the firm's profit? $0 $200 $250 $450 At the profit-maximizing level of output, O...
The table below represents the output and cost structure for a firm. The market is perfectly...
The table below represents the output and cost structure for a firm. The market is perfectly competitive, and the market price is $10. Total costs include all implicit opportunity costs. Total Cost Marginal Marginal Cost Revenue Total Revenue 0 Average Total Cost Average Variable Cost Output 0 Profit 3 XXX XXX 1 2 7 9 10 10 20 30 3 4 12 40 5 16 50 6 22 60 7 30 70 8 40 80 90 9 52 10 68...
9. Refer to Figure: 1. The haircut is $16. A. marginal cost of a B. average...
9. Refer to Figure: 1. The haircut is $16. A. marginal cost of a B. average total cost of a C. profit-maximizing price for a D. profit from each 10. Refer to Figure: 1. If Clips Ahoy maximizes profits, its equals $320. 10. A. variable cost B. total cost C. total revenue D. profit MC АТС 16 14 a 8 12 10 f MR 0 20 23 25 30 q Number of haircuts Figure 1: "Clips" Ahoy Barber Shop
19. Table 13-16 Quantity Total Cost Fixed Cost Variable Cost Marginal Cost Average Fixed Cost Average Variable Aver...
19. Table 13-16 Quantity Total Cost Fixed Cost Variable Cost Marginal Cost Average Fixed Cost Average Variable Average Total Cost 0 $24 $16 $50 $108 Refer to Table 13-16. What is the fixed cost of producing units of output? a. $16 b. $24 C. $12 d. $0 20. Refer to Table 13-16 in Question 19. What is the total cost of producing 2 units of output? a $76 b. $74 C. $58 d. $50 21. Refer to Table 13-16 in...
3) Monopolistic Competition Long-Run (7 points) The marginal costs (MC), average variable costs (AVC), and average...
3) Monopolistic Competition Long-Run (7 points) The marginal costs (MC), average variable costs (AVC), and average total costs (ATC) for a monopolistically competitive firm are shown in the figure below. Price/Cost (S) a. What is the firm's profit-maximizing output level? b. What is its profit-maximizing price? c. What is the firm's economic profit? d. What would the output level be that is productively efficient (minimizes ATC)? e. At what price and output level would this outcome be allocatively efficient? (Hint...
The minimum point of the average variable cost curve (AVC) is referred to as the a....
The minimum point of the average variable cost curve (AVC) is referred to as the a. Break-even price. b. Shut-down price. c. Government subsidy price. d. Profit maximizing point A firm will shut down its operation temporarily if a. It is not making an economic profit. b. Marginal cost exceeds marginal revenue c. The price is equal to average total cost d. It is not making a normal profit e. It is unable to cover its variable costs.
The graph below shows the marginal, average variable, and average total cost curves for a perfectly competitive firm. Refer to the graph to answer the following questions. Instructions: Indicate the profit-maximizing level of output. Enter your response as a whole number. Price and cost MC ATC AVC $40.50 36.00 30.00 MR 22.00 20.00 130 180 240 Quantity a. What is the amount of the fixed cost of production? $ b. Suppose the market price is $30 what is the firm's...
The graph below shows the marginal, average variable, and average total cost curves for a pizza seller. Refer to the graph to answer the following questions. Instructions: Indicate the profit-maximizing level of output. Enter your response as a whole number. Cost Curves 3.50 3.25 3.00 2.75 Select Select Select 2.50 (S/slice) 2.00 W 1.75 1.50 1.25 1.00 0.75 0.50 0.25 100 200 300 400 500 600 700 800 900 Q -> Quantity (slices/day) a. What is the amount of the...
15. When marginal cost is less than average total cost, a. marginal cost must be falling. b. average variable cost must be falling. c. average total cost is falling. d. average total cost is rising. 16. Which of the following is not a characteristic of a competitive market? a. Buyers and sellers are price takers. b. Each firm sells a virtually identical product. c. Entry is limited d. Each firm chooses an output level that maximizes profits. 17. If a...
14. Refer to Figure 13-8. Which of the following statements is correct? a. Marginal cost is rising for quantities higher than D because marginal cost is higher than average total cost. b. Average variable cost is declining for quantities less than B because marginal cost is lower than average variable cost. c. Marginal cost is minimized at B because at that quantity, marginal cost equals average variable cost. d. All of the above are correct. 15. When marginal cost is...
The minimum wage is an example of O a price ceiling. O a price floor. O a wage subsidy O a tax. Suppose that a firm is currently maximizing its short-run profit at an output of 50 units. If the current price is $9, the marginal cost of the 50th unit is $9, and the average total cost of producing 50 units is $4, what is the firm's profit? $0 $200 $250 $450 At the profit-maximizing level of output, O...
The table below represents the output and cost structure for a firm. The market is perfectly competitive, and the market price is $10. Total costs include all implicit opportunity costs. Total Cost Marginal Marginal Cost Revenue Total Revenue 0 Average Total Cost Average Variable Cost Output 0 Profit 3 XXX XXX 1 2 7 9 10 10 20 30 3 4 12 40 5 16 50 6 22 60 7 30 70 8 40 80 90 9 52 10 68...
9. Refer to Figure: 1. The haircut is $16. A. marginal cost of a B. average total cost of a C. profit-maximizing price for a D. profit from each 10. Refer to Figure: 1. If Clips Ahoy maximizes profits, its equals $320. 10. A. variable cost B. total cost C. total revenue D. profit MC АТС 16 14 a 8 12 10 f MR 0 20 23 25 30 q Number of haircuts Figure 1: "Clips" Ahoy Barber Shop
19. Table 13-16 Quantity Total Cost Fixed Cost Variable Cost Marginal Cost Average Fixed Cost Average Variable Average Total Cost 0 $24 $16 $50 $108 Refer to Table 13-16. What is the fixed cost of producing units of output? a. $16 b. $24 C. $12 d. $0 20. Refer to Table 13-16 in Question 19. What is the total cost of producing 2 units of output? a $76 b. $74 C. $58 d. $50 21. Refer to Table 13-16 in...
3) Monopolistic Competition Long-Run (7 points) The marginal costs (MC), average variable costs (AVC), and average total costs (ATC) for a monopolistically competitive firm are shown in the figure below. Price/Cost (S) a. What is the firm's profit-maximizing output level? b. What is its profit-maximizing price? c. What is the firm's economic profit? d. What would the output level be that is productively efficient (minimizes ATC)? e. At what price and output level would this outcome be allocatively efficient? (Hint...
The minimum point of the average variable cost curve (AVC) is referred to as the a. Break-even price. b. Shut-down price. c. Government subsidy price. d. Profit maximizing point A firm will shut down its operation temporarily if a. It is not making an economic profit. b. Marginal cost exceeds marginal revenue c. The price is equal to average total cost d. It is not making a normal profit e. It is unable to cover its variable costs.
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