Question 16b MSN.com Hollmail, Oullo X 7 Week 3: MEL Homework × @ Do Homework Pa

Question

Question 16b

MSN.com Hollmail, Oullo X 7 Week 3: MEL Homework × @ Do Homework Pa'mela l 1 X + www.google.com/ CSearch Principles of Economics Pamela Harris 11/10/17 1:49 PM Homework: Week 3 Homework 35 pts Save Score: 0 of 1 pt 16 of 35 (24 complete) HW Score: 61.9%, 21.67 of 35 pts Instructor Assignable 5 Question Help Big Top is the only circus in the nation. The table sets out the demand schedule for circus tickets and the cost schedule for producing the circus Calculate Big Top's profit-maximizing price, output and economic profit if it charges a single price for al Price (dollars per ticket) 50 45 40 35 30 25 20 15 10 Quantity Total cost (dollars per per show) 1,000 2,500 4,000 5,500 7,000 8,500 10,000 11,500 13,000 ickets. Big Top's profit-maximizing output istickets a show. Big Top's profit-maximizing price is $ a ticket. >>Answer to 2 decimal places. 100 200 300 400 600 700 800 .. 1.1 :/ . | (U) More Enter your answer in the edit fields and then click Check Answer. Clear All Check Answer 16h 3:49 PM Type here to search 11/10/2017

Explanation / Answer

Answer

MC of n the unit=(TC of n units -TC of p units )/(n-p)...............n>p

TR=P*Q

MR of n th unit=(TR of n units -TR of p units)/(n-p)...................n>p

profit=TR-TC

profit is maximum at MR=MC
where
Q=400 units
P=$30
Economic profit=$5000

P Q TC MC TR MR Profit 50 0 1000 0 -1000 45 100 2500 15 4500 45 2000 40 200 4000 15 8000 35 4000 35 300 5500 15 10500 25 5000 30 400 7000 15 12000 15 5000 25 500 8500 15 12500 5 4000 20 600 10000 15 12000 -5 2000 15 700 11500 15 10500 -15 -1000 10 800 13000 15 8000 -25 -5000

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