Before World War IL, Aleos Corporation bad a monopoly in the production of alumi
ID: 1122716 • Letter: B
Question
Before World War IL, Aleos Corporation bad a monopoly in the production of aluminm Assuno at its d and cost data .s folow 93 91 10 12 13 15 17 13 15 87 24 A Use the sumbers above sf in the following able 12 13 14 15 17 B. What is probari it glevel of oupm? D. Gives the average sotal cost data, wha profist is Alcos making per unit of oup he price is deternined by the demand orve. Then its shon-run proi-maimizing ou level F l this case, its short-cun profis-maximining price G. What would be the profits per unit of Alcon in this casExplanation / Answer
Total revenue is given as : Price multiplied by quantity.
Marginal revenue is the additial revenue generated on addition of 1 more quantity
Total Cost is : Average total cost *Quantity
Marginal cost is the additional cost on addition of 1 more quantity.
Total Profit is total revenues minus total cost.
2. Profit maximizing output is at that level where there is biggest gap between total revenues and total cost. This is $1020. $1020 is the highest profit and hence, the profit maximizing output is 15.
3. The profit maximizing price related to the profit level of $1020 is $85.
4. Profit per unit of output=P- ATC
The profit maximizing price is $85 and the average total cost at this price is $17. Thus, profit per unit of output= 85-17= $68
Quantity Price ATC TR MR MC TC (ATC*Q) Total Profit (TR-TC) (P*Q) 11 93 10 1023 1023 110 110 913 12 91 11 1092 69 22 132 960 13 89 13 1157 65 37 169 988 14 87 15 1218 61 41 210 1008 15 85 17 1275 57 45 255 1020 16 83 20 1328 53 65 320 1008 17 81 24 1377 49 88 408 969 18 79 28 1422 45 96 504 918Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.