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Can someone please explain how to compute these? 1. Assume that the short-run cost and demand data given in the tables below confront a monopolistic
Can someone please explain how to compute these?
1. Assume that the short-run cost and demand data given in the tables below confront a monopolistic competitor selling a given product and engaged in a given amount of product promotion.
Cost Data | Demand Data | ||
---|---|---|---|
Total Output | Total Cost | Quantity Demanded | Price |
0 | $ 25 | 0 | $ 50 |
1 | 40 | 1 | 48 |
2 | 45 | 2 | 46 |
3 | 55 | 3 | 44 |
4 | 70 | 4 | 42 |
5 | 90 | 5 | 40 |
6 | 115 | 6 | 38 |
If the firm sells 2 units of output, marginal revenue will be
Multiple Choice
- $28.
- $44.
- $4.
- $92.
2. Answer the question based on the demand and cost schedules for a monopolistically competitive firm given in the table below.
Price | Quantity Demanded | Total Cost | Output |
---|---|---|---|
$ 24 | 1 | $ 10 | 1 |
20 | 2 | 20 | 2 |
16 | 3 | 29 | 3 |
12 | 4 | 36 | 4 |
8 | 5 | 40 | 5 |
4 | 6 | 42 | 6 |
What output quantity will the monopolistically competitive firm produce to maximize profits?
Multiple Choice
- 3
- 4
- 2
- 5
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