A perfectly competitive firm faces a market-determined price of $25 for its product.

a. The firm?s total costs are given in the schedule above. Fill in columns 3 and 4 for average total cost and marginal cost.b. Fill in columns 5 and 6 for marginal revenue and profit margin.c. How much output should the competitive firm produce? Explain.d. Label column 7 ?Total profit? and fill in the values. Is your answer to part c correct? Explain.e. Suppose the demand for the firm?s product decreases and the market price falls to $14. Should the firm shut down? If not, how much output should the firm produce?Explain.

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(1) (2) (3) (4) (5) (6) (7) Average Marginal Marginal Profit cost Total total Quantity cost cost margin revenue 1000 100 2000 200 3300 300 4800 400 7000 500 9600