Question
In: Economics
Suppose the market price is $10 (this is also the firm's marginal cost), a firm's quantity...
Suppose the market price is $10 (this is also the firm's marginal cost), a firm's quantity sold is 11, and the average total cost for the firm at that price is $7. What is the firm's profit?
|
$330 |
||
|
$0 |
||
|
$110 |
||
|
$33 |
||
|
The firm would not produce at this quantity because it does not maximize the firm's profit. |
Solutions
Expert Solution
Option D- $33
Market price = $10
Quantity Sold = 11
Total Revenue = Price * Quantity =10 * 11= $110
Average Total Cost = $7
Average Total Cost = Total Cost / Total Quantity Sold
Total Cost = Average Total Cost * Total Quantity Sold
= $7 * 11 = $77
Profit = Total Revenue - Total Cost
= $110 - $77
= $33
Rahul Sunny answered 2 years agoRelated Solutions
Market price is $50. The firm's marginal cost curve is given by MC = 10 +...
Market price is $50. The firm's marginal cost curve is given by
MC = 10 + 2Q.
a. Find the profit-maximizing output for the firm.
b. At this output, is the firm making a profit? Explain your
answer.
Suppose that a monopoly faces the demand, marginal revenue, and cost schedules below. Quantity Price Marginal...
Suppose that a monopoly faces the demand, marginal revenue, and
cost schedules below.
Quantity
Price
Marginal Revenue
Marginal Cost
Average Total Cost
1
230
230
100
150
2
210
190
100
125
3
190
150
100
116.6666667
4
170
110
100
112.5
5
150
70
100
110
6
130
30
100
108.3333333
7
110
-10
100
107.1428571
8
90
-50
100
106.25
9
70
-90
100
105.5555556
10
50
-130
100
105
What quantity maximizes profit?
The monopoly Q =...
a. The market price is determined by: multiple choice 1 marginal revenue and marginal cost. market...
a. The market price is determined by:
multiple choice 1
marginal revenue and marginal cost.
market demand and market supply.
marginal revenue and average total cost
b. To determine the firm's profit-maximizing output, the
firm will set its marginal revenue equal to:
multiple choice 2
marginal cost.
average variable cost.
average total cost.
market price.
c. A firm is making an economic profit if, at the
profit-maximizing output, the market price is:
multiple choice 3
less than average total cost....
When price exceeds average variable cost in the short run, a competitive firm's marginal cost curve...
When price exceeds average variable cost in the short run, a competitive firm's marginal cost curve is regarded as its supply curve because
a. the position of the marginal cost curve determines the price for which the firm should sell its product.
b. among the various cost curves, the marginal cost curve is the only one that slopes upward.
c. the marginal cost curve determines the quantity of output the firm is willing to supply at any...
Suppose that a competitive firm's marginal cost of producing output q is given by MC(q) =...
Suppose that a competitive firm's marginal cost of producing
output q is given by MC(q) = 3+2q. Assume that the market price of
the firm's product is $9.
(a) What level of output will the firm produce?
(b) Suppose that the average variable cost of this firm is given
by AV C(q) = 3 + q. Suppose that the firm's fixed costs are known
to be $3. Will the firm be earning a positive, negative, or zero
profit in the...
In a price-taker market, each firm's short run supply curve is its marginal cost curve, above its minimum average total cost.
7) T/F In a price-taker market, each firm's short run supply
curve is its marginal cost curve, above its minimum average total
cost.8) T/F The limited liability of stockholders in the corporate
business structure makes it harder to raise equity capital.9) T/F In the year 2008, nearly three out of four business firms
in the United States were organized as proprietorships.10) T/F When demand is relatively price inelastic, price and
total revenue will change in the same direction.11) T/F As...
A certain monopoly has a marginal cost that depends on the quantity produced. The marginal cost...
A certain monopoly has a marginal cost that depends on the
quantity produced. The marginal cost is MC = 4Q
The marginal revenue curve is: MR = 40 – 4Q
The demand curve is: D = 40 - 2Q
Fixed cost of production $10, variable cost is $5 per unit
produced.
a) Graph the MR, MC and demand curves!
b) Which quantity the monopoly will produce at which price?
c) Calculate the profit!
Assume an oligopolistic market with one large dominant firm. The dominant firm's marginal cost is given...
Assume an oligopolistic market with one large dominant firm. The
dominant firm's marginal cost is given by the following
equation:
MC = 0.46 Q
The market demand is the following: QD = - 13 P + 261
The supply of the smaller firms combines is given by the
following equation:
QS = 24 P + 168
What would be the combined production of the small firms?
Suppose a firm's marginal product of capital and marginal product of labor schedules are as shown...
Suppose a firm's marginal product of capital and marginal
product of labor schedules are as shown in the table below. The
firm hires both capital and labor competitively for $5 and $8,
respectively. This assignment will be graded out of 6 points with 2
points possible for each question.
Capital
MP of Capital
Labor
MP of Labor
0
0
1
10
1
28
2
9
2
30
3
8
3
24
4
7
4
20
5
6
5
16
6...
Suppose a firm's marginal product of capital and marginal product of labor schedules are as shown...
Suppose a firm's marginal product of capital and marginal
product of labor schedules are as shown in the table below. The
firm hires both capital and labor competitively for $4 and $8,
respectively. Its output is sold in a competitive market for $.50
per unit.
Capital
MP of Capital
Labor
MP of Labor
0
0
1
10
1
28
2
9
2
30
3
8
3
24
4
7
4
20
5
6
5
16
6
5
6
12
7...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- “Triangle Guessing” game in Python The program accepts the lengths of three (3) sides of a...
- THIS PROGRAM HAS TO BE WRITTEN IN C Single function to perform the parity computation on...
- Consider a buffer system consisting of Benzoic acid (pKa = 4.20) and sodium benzoate, a) Would...
- Decision Variables S T Minimize 1.8S + 2.20T Subject to: Potassium 5S + 8T >= 200...
- A neurologist needs to counsel a stroke victim and her husband about possible outcomes, treatment options,...
- Case Study: Personal Beliefs in the Workplace Don Shakow was a prominent professional who worked in...
- 1: Competency framework usage is the modern best practice in management. What is meant by competency...
ADVERTISEMENT