ECO101H1 Lecture 6: Lecture 6, ch 9
45 views2 pages
Get access
Grade+20% off
$8 USD/m$10 USD/m
Billed $96 USD annually
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers
Class+
$8 USD/m
Billed $96 USD annually
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
30 Verified Answers
Related textbook solutions
Related Documents
Related Questions
Suppose that a firm in a competitive market faces the following revenues and costs:
Quantity | Total Revenue | Total Cost |
0 | $0 | $3 |
1 | $7 | $5 |
2 | $14 | $9 |
3 | $21 | $15 |
4 | $28 | $23 |
5 | $35 | $33 |
6 | $42 | $45 |
7 | $49 | $59 |
At which level of production will the firm maximize profit?
3 units
4 units
5 units
6 units
Complete the following table: Assume TFC=$60
Q | TVC | TC | AFC | AVC | ATC | MC |
0 | 0 | 60+0=60 | XX | XXX | XXX | XX |
1 | 30 | 60+30=90 | 60/1=60 | 30/1=30 | 90/1=90 | (90-60)/(1-0)=30 |
2 | 49 | 60+49=109 | 60/2=30 | 49/2=24.5 | 109/2=54.5 | (109-90)/(2-1)=19 |
3 | 65 | |||||
4 | 80 | |||||
5 | 100 | |||||
6 | 124 | |||||
7 | 150 | |||||
8 | 180 | |||||
9 | 215 | |||||
10 | 255 | |||||
11 | 300 | |||||
12 | 360 |
Answer the observation based on the table:
OBSERVATION
(1) At Q=0, TFC = _________.
(2) As Q rises, TFC remains ________________.
(3) At Q = 0, TVC = ___________.
(4) As Q rises, TVC _________.
(5) At Q = 0, TC = __________.
(6) Increases in TC are brought about by increases in ___________.
(7) As Q rises, AFC ___________.
(8) AVC is minimum at Q = ____________.
(9) ATC is minimum at Q = _____________.
(10) When AVC is at its minimum, MC __________ AVC.
(11) When ATC is at its minimum, MC ___________ ATC.