Assume that the firm is producing the number of units that will maximize their profit in a perfectly competitive market. You can use the explanatory for problem 23-3 that are in the Handouts on the main page of your course website to aid you in the completion of this problem. The D curve in this problem is the same as the MR curve. ? How many units of output will the firm produce and sell? ? What is the Total Revenue (TR) at this level of output? ? What is the Average Total Cost (ATC) at this level of output? ? What is the Total Fixed Cost (TFC) at this level of output? Hint: ATC ? AVC = AFC. The average cost figures are (per unit). You need to take the per unit costs x the quantity to get total cost figures. ? What is the Average Variable Cost at this level of output? ? What is the Total Cost (TC) at this level of output? ? What is the total profit or loss at this level of output?

 

Dollars 2.60 2.00- 1.90 1.35 1.05 .80 .50- 0 + II||||| 18 46 80 MC D ATC 100 Quantity AVC