Question
A small firm produces generic waterproof phone cases. It can sell all it is capable of producing at the market price of $15 each .
A small firm produces generic waterproof phone cases. It can sell all it is capable of producing at the market price of $15 each. Its monthly cost function is
TC = 2500 + 0.2Q + 0.025Q.
The marginal cost for this function is MC = 0.2 + 0.05Q.
a. What are the firm's fixed costs per month? What are its variable costs per month?
b. Find the profit-maximizing monthly quantity
c. Find the monthly profit
d. Should the firm continue to operate in the short run? Very briefly, why or why not?
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Intermediate Microeconomics and Its Application
Authors: Walter Nicholson, Christopher M. Snyder
12th edition
978-1133189022, 1133189024, 1133189032, 978-1305176386, 1305176383, 978-0357687000, 978-1133189039
