The difference between total revenue and total cost is _________________________
ID: 1200561 • Letter: T
Question
The difference between total revenue and total cost is _______________________________
20. . A perfectly competitive firm is definitely earning an economic profit when: ________________
A) MR > MC. B) P > ATC. C) P > MC. D) P > AVC.
-Suppose that a business incurred implicit costs of $200,000 and explicit costs of $1 million in a specific year. If the firm sold 4,000 units of its output at $300 per unit, its accounting profits are:_________________________________________________
-For the economist, total cost includes______________________________ for an economic profit
-Assume the XYZ Corporation is producing 20 units of output. It is selling this output in a purely competitive market at $10 per unit. Its total fixed costs are $100 and its average variable cost is $3 at 20 units of output. This corporation accounting profit is:_______________________________________________________________
-Identify the following market structure
-A market with no close substitutes ____________________________________
-A market that focuses on differentiated products_______________________
-A market with one seller______________________________
-A market where there is collusion________________________
-A market that involves the auto industry_____________________
-A market where you are a price taker_____________________________
-A market where advertising is a strong incentive____________________
Why can fixed costs be considered as an entry fee?
Explanation / Answer
Total revenue (TR) is the total amount the seller receives from the sale of a product in a particular time period; it is calculated by multiplying the product price (P) by the quantity sold (Q). In equation form:
TR = P*Q
Total cost (TC) is the sum of fixed cost and variable cost at each level of output: TC = TFC + TVC.
Profit = Total revenue (TR) – Total costs (TC) or (AR – AC) × Q
Economic Profit = Economic profit = total revenue - (explicit costs + implicit costs).
Identify the following market structure
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