Homework Answers
Ans 8. In order to maximize profits or minimize losses the firm should produce ______ units.
B) 20
The firm should produce this since MR = MC is the profit maximizing condition and in our reference figure, the marginal cost curve cuts the marginal revenue curve at 20 units of output.
Ans 11. C) will make positive economic profits
Since the firm will produce at marginal revenue = marginal cost, the price level will be $13 which is greater than the minimum of the average total cost and hence the firm will be earning positive economic profits. When the difference between the marginal cost and the average total cost is positive, the firm earns positive economic profits.
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Question 8 (Mandatory) (5 points) MC ATC AVC 13 MR Price 00 6 4 0 10...
Question 26 5 pts Price ATC MC AVC DD . m 0 Quantity Refer to the...
Question 26 5 pts Price ATC MC AVC DD . m 0 Quantity Refer to the diagram above. At the point markede, o price is determining production at a level where P = AVC o TR is exactly equal to TC, so profits equal zero. o price is above average cost of production. o the leftover rectangle is the profit earned. Question 28 4 pts The following figure shows the average cost curve, demand curve, and marginal revenue curve for...
$14 $13 $12 MC $11 $10 MR $9 ATC $8 Price of Hats $7 AVC $6...
$14 $13 $12 MC $11 $10 MR $9 ATC $8 Price of Hats $7 AVC $6 $5 $4 $3 $2 $1 $0 0 1 2. 3 4 5 6 7 8 9 10 Quantity of Hats The graph above show information about costs and revenue for a small hat factory in a perfectly competitive market. How much profit does the hat factory make? $16 $12 $8 $10
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.
MC 450 400 350 300 250 200 150 100 P MR ATC AVC 50 1 2345...
MC 450 400 350 300 250 200 150 100 P MR ATC AVC 50 1 2345 7 89 10 11 12 Quantity What area in the graph above represents total economic profits for the firm? MFWT OCBWT DAFM DABC Price
MC ATC MC ATC -D MR MR 0 0 (b) MC ATC D MR (c) 65....
MC ATC MC ATC -D MR MR 0 0 (b) MC ATC D MR (c) 65. Refer to the above diagrams, which pertain to monopolistically competitive firms. Short-run equilibrium entailing economic loss is shown by: A) diagram a only. B) diagram b only. C) diagram conly. D) both diagrams a and c. 66. Refer to the above diagrams, which pertain to monopolistically competitive firms. A short-run equilibrium entailing economic profits is shown by: A) diagram a only. B) diagram b...
$ per unit MC ATC MR $20 AVC 5 10 15 20 25 30 Output (g)...
$ per unit MC ATC MR $20 AVC 5 10 15 20 25 30 Output (g) 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. Calculate the firm's profit. (Do not include a $ sign in your response. Round to the nearest two decimal places if necessary.)
Price MC ATC AVC - MR 40 45 47 Quantity a. (1 points) Using the graph...
Price MC ATC AVC - MR 40 45 47 Quantity 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 for the profit maximizing firm? c. (2 points) What would happen in this market in the long run. Be sure to explain in detail what happens in the market and the firm. What would be the long run price, and...
a The industry A representative firm MC a 9 9 ATC AVC 9 Price (5) Price...
a The industry A representative firm MC a 9 9 ATC AVC 9 Price (5) Price (5) 6 D2 D: Bushels of wheat 101213 15 Bushels of wheat f demand for wheat is D then a profit maximizing firm will produce units and earn O A. 10; negative profits OC. 0; negative profits OB. 12; positive profits OD. 5, zero profits Click to select your answer.
Figure 12-4 Price and cost MC ATC AVC $40.50 36.00 30.00 22.00 20.00 -MR 130 180...
Figure 12-4 Price and cost MC ATC AVC $40.50 36.00 30.00 22.00 20.00 -MR 130 180 240 Quantity Figure 12-4 shows the cost and demand curve for a profit-maximizing firm in a perfectly competitive market. 37) Refer to Figure 12-4. If the market price is $30 and if the firm is producing output, what is the amount of its total variable cost? A) $7,200 B) $6,480 C) $5,400 D) $3,960 Figure 15-6 Revenue and cost per unit $30 ATC Demand...
Figure 2: Short-run unit cost curves P MC ATC 15 AVC 12 11 9 8 5...
Figure 2: Short-run unit cost curves P MC ATC 15 AVC 12 11 9 8 5 5 8 10 13 17 d) (3 points) At a market price of $11, what is the firm's short run profit max- imizing output? e) (3 points) At a market price of $11, is the firm earning positive, negative, or zero economic profit? f) (3 points) At a market price of $11, is the market in a long run equilibrium? Why of Why not?
Question 26 5 pts Price ATC MC AVC DD . m 0 Quantity Refer to the diagram above. At the point markede, o price is determining production at a level where P = AVC o TR is exactly equal to TC, so profits equal zero. o price is above average cost of production. o the leftover rectangle is the profit earned. Question 28 4 pts The following figure shows the average cost curve, demand curve, and marginal revenue curve for...
$14 $13 $12 MC $11 $10 MR $9 ATC $8 Price of Hats $7 AVC $6 $5 $4 $3 $2 $1 $0 0 1 2. 3 4 5 6 7 8 9 10 Quantity of Hats The graph above show information about costs and revenue for a small hat factory in a perfectly competitive market. How much profit does the hat factory make? $16 $12 $8 $10
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.
MC 450 400 350 300 250 200 150 100 P MR ATC AVC 50 1 2345 7 89 10 11 12 Quantity What area in the graph above represents total economic profits for the firm? MFWT OCBWT DAFM DABC Price
MC ATC MC ATC -D MR MR 0 0 (b) MC ATC D MR (c) 65. Refer to the above diagrams, which pertain to monopolistically competitive firms. Short-run equilibrium entailing economic loss is shown by: A) diagram a only. B) diagram b only. C) diagram conly. D) both diagrams a and c. 66. Refer to the above diagrams, which pertain to monopolistically competitive firms. A short-run equilibrium entailing economic profits is shown by: A) diagram a only. B) diagram b...
$ per unit MC ATC MR $20 AVC 5 10 15 20 25 30 Output (g) 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. Calculate the firm's profit. (Do not include a $ sign in your response. Round to the nearest two decimal places if necessary.)
Price MC ATC AVC - MR 40 45 47 Quantity 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 for the profit maximizing firm? c. (2 points) What would happen in this market in the long run. Be sure to explain in detail what happens in the market and the firm. What would be the long run price, and...
a The industry A representative firm MC a 9 9 ATC AVC 9 Price (5) Price (5) 6 D2 D: Bushels of wheat 101213 15 Bushels of wheat f demand for wheat is D then a profit maximizing firm will produce units and earn O A. 10; negative profits OC. 0; negative profits OB. 12; positive profits OD. 5, zero profits Click to select your answer.
Figure 12-4 Price and cost MC ATC AVC $40.50 36.00 30.00 22.00 20.00 -MR 130 180 240 Quantity Figure 12-4 shows the cost and demand curve for a profit-maximizing firm in a perfectly competitive market. 37) Refer to Figure 12-4. If the market price is $30 and if the firm is producing output, what is the amount of its total variable cost? A) $7,200 B) $6,480 C) $5,400 D) $3,960 Figure 15-6 Revenue and cost per unit $30 ATC Demand...
Figure 2: Short-run unit cost curves P MC ATC 15 AVC 12 11 9 8 5 5 8 10 13 17 d) (3 points) At a market price of $11, what is the firm's short run profit max- imizing output? e) (3 points) At a market price of $11, is the firm earning positive, negative, or zero economic profit? f) (3 points) At a market price of $11, is the market in a long run equilibrium? Why of Why not?
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