1) Consider a firm that has a fixed cost of $70. Complete the following table:
Output
FC
VC
TC
MC
AFC
AVC
ATC
1
$20
2
28
3
40
4
56
5
80
2a) A publisher initially prices both hardback books and paperback books at $30 per book. Each book costs $3 to produce. Complete the following table.
Price
Quantity
Total Revenue
Total Cost
Profit
Hardback
$30
150
Paperback
30
150
Total
300
b) The price elasticity of demand for the hardback is 0.6 and the price elasticity of demand for the paperback is 3. Suppose the publisher increases the price for hardback by 10% and decreases the price of paperback by10%. Complete the following table.
Price
Quantity
Total Revenue
Total Cost
Profit
Hardback
Paperback
Total
1) Consider a firm that has a fixed cost of $70. Complete the following table:
|
Output |
FC |
VC |
TC |
MC |
AFC |
AVC |
ATC |
|
1 |
|
$20 |
|
|
|
|
|
|
2 |
|
28 |
|
|
|
|
|
|
3 |
|
40 |
|
|
|
|
|
|
4 |
|
56 |
|
|
|
|
|
|
5 |
|
80 |
|
|
|
|
|
2a) A publisher initially prices both hardback books and paperback books at $30 per book. Each book costs $3 to produce. Complete the following table.
|
|
Price |
Quantity |
Total Revenue |
Total Cost |
Profit |
|
Hardback |
$30 |
150 |
|
|
|
|
Paperback |
30 |
150 |
|
|
|
|
Total |
|
300 |
|
|
|
b) The price elasticity of demand for the hardback is 0.6 and the price elasticity of demand for the paperback is 3. Suppose the publisher increases the price for hardback by 10% and decreases the price of paperback by10%. Complete the following table.
|
|
Price |
Quantity |
Total Revenue |
Total Cost |
Profit |
|
Hardback |
|
|
|
|
|
|
Paperback |
|
|
|
|
|
|
Total |
|
|
|
|
|
Related textbook solutions
Related questions
2. Complete the following cost table:
|
Q |
FC |
VC |
TC |
MC |
AFC |
AVC |
ATC |
|
0 |
- |
- |
- |
- |
|||
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1 |
10 |
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2 |
18 |
5 |
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3 |
23 |
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4 |
6.5 |
where FC is fixed cost, VC is variable cost, TC is total cost, MC is marginal cost, AFC is average fixed cost, AVC is average variable cost, and ATC is average total cost.
Given following Price and Total Cost functions:
P = 120 - 7Q
TC = 40 + 70Q - 10Q2 + 0.6Q3
Where P = price, and Q is output.
Fill in the table below and answer the questions below the table.
|
Q |
P |
FC |
TVC |
TC |
TR |
Profit |
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0 |
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1 |
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2 |
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3 |
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4 |
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5 |
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6 |
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9 |
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10 |
If your company's goal is to maximize profit, answer the following questions below:
What price will you charge for your product?
What quantity will you produce?
And what would be your maximum profit or minimum loss at the price and output you chose?
2. If your company's goal is to maximize total revenue, answer the following questions below:
What price will you charge for your product?
What quantity will you produce?
And what would be your maximum total revenue at the price and output you chose? (3 points)
Question 3
Given a firm with the following cost data, fill in the table below.
Q = OUTPUT TFC = Total Fixed Cost AVC = Average Variable Cost ATC = Average Total Cost TVC = Total Variable Cost MC = Marginal Cost TC = Total Cost
|
Q |
FC |
TVC |
TC |
AVC |
ATC |
MC |
|
0 |
--- |
--- |
--- |
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|
1 |
10 |
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2 |
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3 |
10 |
10 |
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4 |
Consider the following table of costs for the Winsome Widget Factory, which operates in a perfectly competitive market. The market price faced by this firm is $6.00 per widget.
| Output | Total Cost |
| 0 | 100 |
| 10 | 150 |
| 20 | 180 |
| 30 | 200 |
| 40 | 240 |
| 50 | 300 |
| 60 | 375 |
| 70 | 475 |
| 80 | 600 |
| 90 | 750 |
| 100 | 1,000 |
a. Fill in the formula for AFC, AVC, ATC, MC, TR, MR, and Total Profit.
b. Fill in the missing values for TFC, TVC, AFC, AVC, ATC, MC, TR, MR, and Total Profit.
