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a Consider the total Haven (HHHH for short) from making and selling various quan

ID: 1111625 • Letter: A

Question

a Consider the total Haven (HHHH for short) from making and selling various quantities of hamburgers. cost and total revenues of Hermione's Healthy Hamburger tor Number of Hamburgers 1 2 3 4 5 Total Cost Total Revenues $20 $22 $24 $26 $30 $42 s58 $78 S0 $20 $40 S60 $80 $100 $120 $140 A) What is the price of a hamburger? B) What is the fixed cost of HHHH? C) What are the variable costs of HHHH? D) Calculate the Marginal Revenue and Marginal Cost for each number of hamburgers, and show below. E) How many hamburgers should HHHH make to earn maximum profit? Explain your answer?

Explanation / Answer

No. Of Hamburgers (Q)

Total cost (TC)

Total Revenue (TR)

Price

(=TR/Q)

Fixed Cost (FC)

Variable cost (VC)

Marginal cost

Marginal revenue

Profit=

TR-TC

0

$20

$0

$0

$20

$0

$0

$0

-$20

1

22

20

20

20

2

2

20

-2

2

24

40

20

20

4

2

20

16

3

26

60

20

20

6

2

20

34

4

30

80

20

20

10

4

20

50

5

42

100

20

20

22

12

20

58

6

58

120

20

20

38

16

20

62

7

78

140

20

20

58

20

20

62

TR= P.Q

P = TR/Q

We know that, TC = FC + VC

VC = TC- FC

MC= Change in TC / change in quantity

MR = Change in TR/ change in quantity

Profit maximisation = MR=MC

No. Of Hamburgers (Q)

Total cost (TC)

Total Revenue (TR)

Price

(=TR/Q)

Fixed Cost (FC)

Variable cost (VC)

Marginal cost

Marginal revenue

Profit=

TR-TC

0

$20

$0

$0

$20

$0

$0

$0

-$20

1

22

20

20

20

2

2

20

-2

2

24

40

20

20

4

2

20

16

3

26

60

20

20

6

2

20

34

4

30

80

20

20

10

4

20

50

5

42

100

20

20

22

12

20

58

6

58

120

20

20

38

16

20

62

7

78

140

20

20

58

20

20

62

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