Cost and Revenue for "Vernon College Burger Shop"

Jane Smartshop owns "Vernon College Burger Shop," located in Texas. Jane is one of about 5000000 burger joint owners in the United States who produced over 10 billions pounds of burgers in 2018. Jane believes she will be able to sell her burgers for $0.30 in 2019, or $300 per thousand pounds. The table below shows her estimates of her revenue and costs of production for various quantities of burgers.

Total Output (1,000 lbs.)

0

1

2

3

4

5

6

7

8

Total Cost

$50

150

225

275

375

525

725

1025

1425

Marginal Cost

-

$100

75

50

100

150

200

300

400

Total Revenue

$0

300

600

900

1200

1500

1800

2100

2400

Marginal Revenue (Price per 1,000 lbs.)

-

$300

300

300

300

300

300

300

300

1. Determine if "Vernon College Burger Shop" is a perfectly competitive firm.
2. Explain how Jane Smartshopwill decide how much to produce.
3. What are the characteristics of perfectly competitive firm?
4. What is the shut down point for a competitive firm?