Question
In: Economics
A firm has hired you as a consultant. Their only concern is to maximize profits. This...
A firm has hired you as a consultant. Their only concern is to maximize profits. This firm is in a perfectly competitive industry--they have no control over price. They give you the following information: We're selling 25 units at a price of $15 and at the end of the day we're currently earning a profit of $50. It costs us about $20 to produce another unit. Based on your analysis, what would you advise them to do?
Solutions
Rahul Sunny answered 2 years agoRelated Solutions
A firm has hired you as a consultant. Their only concern is to maximize profits. This...
A firm has hired you as a consultant. Their only concern is to
maximize profits. This firm is not in a perfectly competitive
industry--they have some control over price. They give you the
following information:
We're selling 80 units at a price of $20 and at the end of the
day we're currently earning revenues of $1600. Our costs are $2000.
It costs us about $25 to produce another unit.
Based on your analysis, what would you advise them to...
You are hired as a consultant for a fishing company. They wish to maximize profits by...
You are hired as a consultant for a fishing company. They wish
to maximize profits by determining the ideal number of workers. The
number of fish caught per week is a function of the number of crew
on the boat, as follows:
Number of Crew
Fish Caught per Week
(units of 100lbs)
2
3
3
6
4
11
5
19
6
24
7
28
8
31
9
33
10
34
11
34
12
33
The owner tells you that he...
A firm has hired you as an analyst to determine the quantity it should produce to maximize profits.
A firm has hired you as an analyst to determine the quantity it
should produce to maximize profits. Fill in the table, and provide
the quantity of goods the monopoly should produce to maximize
profit in the space below. Do NOT use commas to separate thousands.
Use a space if you'd like. (e.g. write 2000 or 2 000 instead of
2,000. Laulima uses periods and commas as decimal points, so
writing 2,000 makes Laulima think your answer is 2.000.)PriceQuantityTotal CostTotal...
A firm has hired you as a consultant. This firm is perfectly competitive and has no...
A firm has hired you as a consultant. This firm is perfectly
competitive and has no control over price. This firm is selling
10,000 units at a price of $3. Total costs are $40,000. Total
variable costs are $35,000. They can produce another unit at a cost
of about $3. What do you recommend?
shut down
continue to operate at a loss in the short run
decrease quantity
increase quantity
A firm has hired you as a consultant. This firm is not perfectly competitive--it has some...
A firm has hired you as a consultant. This firm is not perfectly
competitive--it has some control over prices. This firm is
currently selling 1000 units, generating $10,000 in revenues and
$12000 in total costs. The marginal revenue is about $4, it costs
them about $5 to make another unit. Per unit variable costs are
about $5 per unit. Based on your analysis, what do you
recommend?
shutdown
operate at a loss
change nothing
decrease price, increase quantity
increase price,...
you are hired as the consultant to a monopolistically competitive firm
you are hired as the consultant to a monopolistically competitive firm. The firm reports the following information about its price, marginal cost, and average total cost. Can the firm possibly be maximizing profit? If the firm is profit maximizing, is the firm in a long-run equilibrium? If not, what will happen to restore long-run equilibrium? a. P < MC, P > ATC I would think that the firm can’t possible be maximizing profit. The firm should raise price, so that...
1. A firm has market power if it can a. maximize profits.
1. A firm has market power if it cana. maximize profits.b. minimize costs.c. influence the market price of the good it sells.d. hire as many workers as it needs at the prevailing wage
rate.2. 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.3. Suppose that a firm operating in perfectly
competitive market...
You are hired as a consultant to a monopolistically competitive firm. The firm reports the following...
You are hired as a consultant to a monopolistically competitive firm. The firm reports the following information about its price, marginal cost, and average total cost:
P = MC, P> ATC
Which of the following statements is true about the firm? Check all that apply.
The firm can increase its profit by reducing its output.
The firm is in long-run equilibrium.
The firm is possibly maximizing profit.
It is often assumed that the goal of the firm is to maximize profits for its...
It is often assumed that the goal of the firm is to maximize
profits for its owners, the shareholders. Is the firm’s goal of
profit maximization always in society’s best interests? Be sure to
defend your answer and cite your sources.
It is often assumed that the goal of the firm is to maximize profits for its...
It is often assumed that the goal of the firm is to maximize
profits for its owners, the shareholders. Is the firm’s goal of
profit maximization always in society’s best interests? Be sure to
defend your answer and cite your sources.
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