Consider the following demand and cost condition information about Firm M, which produces Good N.Note: Q* indicates profit maximizing output level.

Highest price where the quantity of output is equal to zero = R1200

Price at Q*= R650

MC at Q*= R260

AVC at Q*= R150

AFC at Q*= R300

Price at allocative efficient output level = R400

The allocative efficient level of output = 180 units

Total fixed cost = R33000

MC at output equal to zero = R100

1.1. Assuming profit-maximizing behavior, calculate each of the following for Firm M.

ATC = R ___________________

Q*=________________________units

Profit / loss = R_________________________

Lerner index =_________________________

Mark-up =_____________________________

Consumer surplus = R_________________

Deadweight-loss = R___________________

TVC = R____________________

1.2. Calculate the consumer surplus and producer surplus at an allocative efficient level of output (i.e. perfectly competitive market outcome).

Consumer surplus =_______________________

Producer surplus =________________________