Q-3. Label the curves in the diagram and answer following questions. a) What output should this firm produce in order to maximize its profit? Cost Price 10 & 9 8 b) What Price should this firm charge? 7 4 6 c) What is the firms' total revenue at the profit maximizing output? 5 d) What is the firms' total cost at the profit maximizing output? 3 0 300 400 500 600 Quantity Q-4. Assuming that all units of labour cost the same, fill in the blanks in the table. Units of Total TVC MC AVC a) At what level of labour is Labour output marginal cost at a 0 0 0 minimum? 1 100 210 N 220 b) What is the marginal product of labour when 4 units of labour are used? 3 320 4 400 IT 5 LO 460 ||||| CO 6 480 35 Q-5. The data in the following table are for Max's "Car Wash 'n' Wax" business that is in perfect competition. Max pays each of his workers $15 per hour. Quantity Total Marginal Price of Value of MRP of Product Product Product Marginal Labour (car (washes ($/car Product washes 1 wash) hour) worker) A $6 30 25 0 0 20 B 1 5 6 15 N 9 6 10 D 3 12 6 5 E 4 14 6 7 8 TI 15 6 F 5 1 2 3 4 5 6 Quantity of Labour Indicate on the graph, how many workers will Max hire? How many workers will Max hire If the wage rate rose to $21 an hour? Q-6. Following are a Monopolist's Cost and Demand data. Complete the table. Quantity Price Total Marginal Average Total Marginal Profit (+) (Average Revenue Revenue Total Cost Cost or Revenue) (TR) Cost (MR) (TC) (MC) Loss (-) (ATC) 0 16 $10 1 $15 $30.00 15.50 N 14 3 13 10.67 4 12 8.25 5 6.80 11 10 6 6.00 7 9 5.57 8 8 5.25 7 5.00 9 10 6 4.80 Draw the relevant curves and answer questions: (a) Profit Maximizing output? MR 201 & 15 MC 14 (b) This output will sell at a price 12 10 (c) What is the Profit at this output? 8 6 4 2 0 1 2 3 4 2 5 Quantity 7 10 8 9