Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Suppose a purely competitive firm faces a price of $12. At that price, MR = MC at 200 units of output. Fixed costs are $500
- Suppose a purely competitive firm faces a price of $12. At that price, MR = MC at 200 units of output. Fixed costs are $500 and at 200 units of output Average Total Cost is $10.
- Draw a graph with the firm's MR, MC, ATC, and AVC.
- Calculate total revenue.
- Calculate Average Fixed Cost.
- Calculate Average Variable Cost.
- Suppose ATC at 200 units of output is $12 (instead of $10). How much is the profit/loss?
- Shade in the profit/loss at a price of $12 and mark it on your graph.
- Suppose ATC at 200 units of output is $16. How much is the profit/loss?
- Draw a graph with the firm's MR, MC, ATC, and AVC.
- Calculate total revenue.
- Calculate Average Fixed Cost.
- Calculate Average Variable Cost.
- Suppose ATC at 200 units of output is $12 (instead of $10). How much is the profit/loss?
- Shade in the profit/loss at a price of $12 and mark it on your graph.
- Suppose ATC at 200 units of output is $16. How much is the profit/loss?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Microeconomics
Authors: Robert Pindyck, Daniel Rubinfeld
9th Edition
0134184246, 9780134184241
