2. You are given the following information about the costs of production for a f
ID: 1190555 • Letter: 2
Question
2. You are given the following information about the costs of production for a firm.
Quantity
FC
VC
TC
AFC
AVC
ATC
MC
0
90
0
------
------
------
------
1
130
2
35
3
20
4
60
5
240
6
120
A) Complete the table above.
B) Suppose the firm operates in a perfectly competitive market. Based on the information in part A, complete the following table:
Market Price
Profit maximizing level of output
Total Revenue
Total Cost
Profit
$28
$36
$88
$106
$140
Quantity
FC
VC
TC
AFC
AVC
ATC
MC
0
90
0
------
------
------
------
1
130
2
35
3
20
4
60
5
240
6
120
Explanation / Answer
Quantity FC VC TC AFC AVC ATC MC 0 90 0 90 NA NA NA NA 1 90 40 130 90 40 130 40 2 90 70 160 45 35 80 30 3 90 90 180 30 30 60 20 4 90 150 240 22.5 37.5 60 60 5 90 240 330 18 48 66 90 6 90 360 450 15 60 75 120
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