Sean's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Sean produced six fire engines, but he is considering increasing production to seven fire engines. The following graph shows the demand curve Sean faces. As you can see, to sell the additional engine, Sean must lower his price from $100,000 to $50,000 per fire engine. Note that although Sean would gain revenue from the additional engine he sells, he would also lose revenue from the initial six engines because he would have to sell them all at the lower price.

Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial six engines by selling at $50,000 rather than $100,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $50,000.

2 . The components of marginal revenue Sean's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Sean produced six fire engines, but he is considering increasing production to seven fire engines. The following graph shows the demand curve Sean faces. As you can see, to sell the additional engine, Sean must lower his price from $100,000 to $50,000 per fire engine. Note that although Sean would gain revenue from the additional engine he sells, he would also lose revenue from the initial six engines because he would have to sell them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial six engines by selling at $50,000 rather than $100,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $50,000. 250 225 PRICE (Thousands of dollars per fire engine) 200 Revenue Lost 175 150 Revenue Gained 125 100 Demand 75 50 25 nformation s...docxAsst # 8 (Unit 09) Revenue Lost Revenue Gained PRICE (Thousands of dollars per fire engine) Demand 4 QUANTITY (Fire engines) Sean increase production from 6 to 7 fire engines, because the dominates in this scenario. True should ean's Fire Engines were a competitive firm instead and $100,000 were the market price for an engine, decreasing its price from $100, should not 00 would result in an increase in production quantity and total revenue. True O False200 Revenue Lost 175 150 Revenue Gained 125 PRICE (Thousands of dollars per fire engine) 100 Demand 75 50 25 0 2 3 4 5 6 8 9 10 QUANTITY (Fire engines) Sean increase production from 6 to 7 fire engines, because the dominates in this scenario. True or False: If Sean's Fire Engines were a competitive firm instead and $100,0 output effect rket price for an engine, decreasing its price from $100,000 to $50,000 would result in an increase in production quantity and total price effect O True O False