Quantity | Total Cost |
Marginal Cost |
Average
Total |
Average Variable Cost |
0 | 1,000 | - | - | - |
10 | 1,600 | 60 | 160 | 60 |
20 | 2,100 | 50 | 105 | 55 |
30 | 2,500 | 40 | 83.33 | 50 |
40 | 2,800 | 30 | 70 | 45 |
50 | 3,200 | 40 | 64 | 44 |
60 | 3,700 | 50 | 61.67 | 45 |
70 | 4,300 | 60 | 61.43 | 47.14 |
80 | 5,000 | 70 | 62.50 | 50 |
90 | 5,800 | 80 | 62.44 | 53.33 |
Consider the above costs of a purely competitive firm.
Calculate this firm's profit maximizing quantity and profit (or loss) when the market price of the computer software equals $72.
quantity = 80; profit = $760
quantity = 80; profit = $430
quantity = 70; profit = $40
quantity = 70; profit = -$170
quantity = 50; profit = -$100
quantity = 0; profit = -$1,000
quantity = 60; profit = $20
quantity = 60; profit = -$160
B:
Calculate this firm's profit maximizing quantity and profit (or loss) when the market price of the computer software equals $56.
quantity = 60; profit = $220
quantity = 50; profit = -$1,050
quantity = 30; profit = -$1,210
quantity = 70; profit = $40
quantity = 60; profit = -$340
quantity = 80; profit = $220
quantity = 80; profit = -$40
quantity = 0; profit = -$1,000
In case of Perfect Competition the firm maximizes profit by equating price to MC.
1. Here price is $72 and at a output of 80 MC = 70
Thus, the firm should produce 80 units.
Profit = $72*80 - $ 5000 = $ 5760 - 5000 = $ 760
First one is correct
Output = 80, profit = $ 760
2. When price is $ 56
Then quantity sold will be 60 units
Profit = $56*60 - 3700 = $ 3360 - 3700 = - $ 340
Quantity = 60, profit = - $ 340
Please contact if having any query thank you.
Quantity Total Cost Marginal Cost Average Total Cost Average Variable Cost 0 1,000 - - -...
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