ECO101H1 Chapter 11, 12: ECO101H1 Chapter 11, 1: ECO101H1 Chapter 11, : ECO101H1 Chapter 11,: Textbook ch11, 12
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An amusement park, whose customer set is made up of two markets, adults and children, has developed demand schedules as follows:
The marginal operating cost of each unit of quantity is $5. Because marginal cost is a constant, so is an average variable cost. Ignore fixed costs. The owners of the amusement part want to maximize profits.
Price ($) |
Quantity |
|
Adults |
Children |
|
5 |
15 |
20 |
6 |
14 |
18 |
7 |
13 |
16 |
8 |
12 |
14 |
9 |
11 |
12 |
10 |
10 |
10 |
11 |
9 |
8 |
12 |
8 |
6 |
13 |
7 |
4 |
14 |
6 |
2 |
Calculate the price, quantity, and profit if: The amusement park charges a different price in the adult market
Please express your answers for Price and Profit in whole dollars (i.e.10.00)
Please use whole numbers for Quantity (i.e. 10, 27, 4)
Price |
Quantity |
Total Revenue |
Marginal Revenue |
Marginal Cost |
Total Cost |
MR-MC |
Profit |
6 |
84 |
5 |
30 |
34 |
|||
13 |
91 |
7 |
5 |
35 |
2 |
56 |
|
12 |
8 |
96 |
5 |
5 |
40 |
0 |
|
9 |
99 |
3 |
5 |
45 |
-2 |
54 |
|
10 |
100 |
1 |
5 |
50 |
-4 |
50 |
|
9 |
11 |
99 |
-1 |
5 |
55 |
-6 |
|
12 |
96 |
-3 |
5 |
60 |
-8 |
36 |
|
7 |
91 |
-5 |
5 |
65 |
-10 |
26 |
|
6 |
14 |
84 |
-7 |
5 |
70 |
-12 |
|
5 |
15 |
75 |
-9 |
5 |
75 |
-14 |
0 |
An amusement park, whose customer set is made up of two markets, adults and children, has developed demand schedules as follows:
The marginal operating cost of each unit of quantity is $5. Because marginal cost is a constant, so is average variable cost. Ignore fixed costs. The owners of the amusement part want to maximize profits.
Price ($) |
Quantity |
|
Adults |
Children |
|
5 |
15 |
20 |
6 |
14 |
18 |
7 |
13 |
16 |
8 |
12 |
14 |
9 |
11 |
12 |
10 |
10 |
10 |
11 |
9 |
8 |
12 |
8 |
6 |
13 |
7 |
4 |
14 |
6 |
2 |
Calculate the price, quantity, and profit if: The amusement park charges the same price in the two markets combined
Please express your answers for Price and Profit in whole dollars (i.e.10.00)
Please use whole numbers for Quanitity (i.e. 10, 27, 4)
Price |
Quantity |
Total Revenue |
Marginal Revenue |
Marginal Cost |
Total Cost |
MR-MC |
Profit |
14 |
8 |
112 |
5 |
40 |
72 |
||
11 |
143 |
10.33 |
5 |
55 |
5.33 |
88 |
|
12 |
168 |
8.33 |
5 |
70 |
3.33 |
98 |
|
11 |
17 |
187 |
6.33 |
5 |
85 |
1.33 |
|
20 |
200 |
4.33 |
5 |
100 |
-0.67 |
100 |
|
9 |
207 |
2.33 |
5 |
115 |
-2.67 |
92 |
|
8 |
26 |
208 |
0.33 |
5 |
130 |
-4.67 |
|
29 |
203 |
-1.67 |
5 |
145 |
-6.67 |
58 |
|
6 |
192 |
-3.67 |
5 |
160 |
-8.67 |
||
5 |
35 |
175 |
-7.67 |
5 |
190 |
-12.67 |
-38 |
The following schedule shows demand and total cost for a firm with market power:
Price |
Quantity |
Total Cost |
$30 |
10 |
$200 |
29 |
11 |
208 |
28 |
12 |
217 |
27 |
13 |
227 |
26 |
14 |
238 |
25 |
15 |
250 |
24 |
16 |
263 |
- To maximize profit firm should produce ______ units of output and charge a price of $_______.
- At this level of output the firm earns a profit of $________.
- The last unit of output produced and sold adds $________ to revenue and $________ to cost.
- One more unit of output beyond the profit-maximizing level of output would add $________ to revenue and $________ to cost, thereby ___________ profit by $________