4. PC Camera GmBH faces costs of production as follows:

a. Calculate the company’s average fixed costs, average variable costs, average total costs and marginal costs at each level of production.

b. The price of a PC camera is €50. Seeing that he can’t make a profit the chief executive officer (CEO) decides to shut down operations. What are the firm’s profits/losses?
Was this a wise decision? Explain.

c. Vaguely remembering her introductory business economics course, the chief financial officer (CFO) tells the CEO it is better to produce 1 PC camera because marginal revenue equals marginal cost at that quantity. What are the firm’s profits/losses at that level of production?
Was this the best decision? Explain.

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Quantity 0 100 Total fixed costs () Total variable costs () 0 1 100 50 2 100 70 3456 3 100 90 100 140 100 200 100 360