Question

1)

A price-taking firm sells 2,000 units at a price of $7 each. If their AFC = $5 and their AVC = $3, how much profit will it make?

Group of answer choices

a profit = -2,000

b profit = 14,000

c profit = 4,000

d None of these answers

e profit = 8,000

2)

Assume there are 50 identical firms in a perfectly competitive (price-taking) market. Assume EACH firm has the cost structure given below.

Quantity	0	1	2	3	4	5	6	7
Total Cost	200	240	270	320	390	490	620	780

If the market price of the good is $100, what will be the total quantity produced in the market?

Group of answer choices

a Q = 250

b Q = 4900

c Q = 500

d Q = 400

e Q = 5000

Answer 1

Date O = 2000 inits, brice: $7 A.F.C - $5, AV.C = $3 So T.T-C= A.F.C+A.V.L - St3 TiCA TCX Q. → 8 X 2000 16000 TR= Рx 9 7 X 2000 [ $14000 Profut= T.R-T.C 14000 16000 2000 Heme (A) part is a correct answer

2 Quantity Total lost Me O Zoo 7 240 Ио 3o 2 270 320 3 4 5 6 390 uno 6 Lo 50 70 loo 130 160 7 780 So if the brice is $ 100 Equilibrium is where P = M-C = 100 Herre from table, it is at 5 units. East As there are so idential forns So Omantity = soxs =25o usits Here (A) part is a correct answer Note - Please hit like, Thanks