Question
In: Economics
1.If the market price is $10, what is the firm’s short-run economic profit? a. $9 b....
1.If the market price is $10, what is the firm’s short-run economic profit?
a. $9 b. $15 c. $30 d. $50
2.If the market price is $6, what is the firm’s short-run economic profit?
a. $0 b. $12 c. $15 d. $18
3.If the market price is $10, what is the firm’s total cost?
a. $15 b. $30 c. $35 d. $50
4.If the market price is $10, what is the firm’s total revenue?
a. $15 b. $30 c. $35 d. $50
5.The firm will earn zero economic profit if the market price is
a. $0. b. $6. c. $7. d. $10.
6.The firm will earn positive economic profit if the market price is
a. positive.
b. $6.
c. above $6
d. There is no price at which the firm earns positive economic profits.
Solutions
Expert Solution
1.
Correct Answer:
B. $15
In competitive market,
P = MR = MC = $10
Q = 5
Economic profit = total revenue – total cost = 10*5 – 7*5 = $15
2.
Correct Answer:
A. $0
P = MR = MC = $6
Economic profit = total revenue – total cost = 6*3 – 6*3 = 0
3.
Correct Answer:
C. $35
When price is $10.
Total cost = Average cost * quantity = 7*5 =$35
4.
Correct Answer:
D. $50
When price is $10.
Total revenue= Average price * quantity = 10*5 =$50
5.
Correct Answer:
B. $6
At price = $6
Economic profit = total revenue – total cost = 6*3 – 6*3 = 0
6.
Correct Answer:
C. above $6
Above the price of $6, firm will earn positive economic profit.
Rahul Sunny answered 2 years agoRelated Solutions
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