Please help with ALL (5) questions and show work/explain... thank you You are gi
ID: 1202383 • Letter: P
Question
Please help with ALL (5) questions and show work/explain... thank you
You are given the following data for your firm, which sells high-capacity video MP3 players.
Q
P
TC
0
78
$100,000
1,000
76
$125,500
2,000
74
$144,000
3,000
72
$158,500
4,000
70
$172,000
5,000
68
$187,500
6,000
66
$208,000
7,000
64
$236,500
8,000
62
$276,000
9,000
60
$329,500
10,000
58
$400,000
..
.
QUESTION 1:
Which of the following represents the correct formulas for P and MR in terms of QD?
Select one:
a. P = 78 - 0.004QD; MR = 78 - 0.008QD
b. P = 39,000 - 500QD; MR = 39,000 - 1,000QD
c. P = 78 - 0.002QD; MR = 78 - 0.004QD
d. P = 39,000 - 500QD; MR = 39,000 - 250QD
.
.
QUESTION 2: Which of the following equations is correct, based on the data above?
Select one:
a. MC = 0.0000015Q2 - 0.01Q + 30
b. AVC = 0.0000005Q2 - 0.005Q + 30 + 100000/Q
c. AVC = 0.0000005Q2 - 0.005Q + 30/Q
d. ATC = 0.0000005Q3 - 0.005Q2 + 30Q + 100000
.
.
.
QUESTION 3. The profit-maximizing quantity occurs at _______ and at _________.
(Since MC is in terms of Q2, solving with calculus and algebra can be messy. Your table should give an exact answer.)
Select one:
a. Q = 6,000; P = $66
b. Q = 8,000; P = $46
c. Q = 8,000; P = $62
d. Q = 2,000; P = $74
.
.
.
QUESTION 4.
How much total profit would your firm earn if you set P and Q at their profit-maximizing levels?
Select one:
a. $276,000
b. $220,000
c. $0; break even.
d. $496,000
.
.
.
QUESTION 5.
Describe the competitiveness of the market by calculating the Lerner index.
Select one:
a. 62%
b. 46%
c. 34.8%
d. 25.8%
Q
P
TC
0
78
$100,000
1,000
76
$125,500
2,000
74
$144,000
3,000
72
$158,500
4,000
70
$172,000
5,000
68
$187,500
6,000
66
$208,000
7,000
64
$236,500
8,000
62
$276,000
9,000
60
$329,500
10,000
58
$400,000
Explanation / Answer
1. c. P = 78 - 0.002QD; MR = 78 - 0.004QD
2. MC = 0.0000015Q2 - 0.01Q + 30
3. Q = 8,000; P = $62
4. $220,000
Q p TC FC VC MC TR MR Profit 0 78 100000 100000 0 - 0 -100000 1000 76 125000 100000 25000 25000 76000 76000 -49000 2000 74 144000 100000 44000 19000 148000 72000 4000 3000 72 158500 100000 58500 14500 216000 68000 57500 4000 70 172000 100000 72000 13500 280000 64000 108000 5000 68 187500 100000 87500 15500 340000 60000 152500 6000 66 208000 100000 108000 20500 396000 56000 188000 7000 64 236500 100000 136500 28500 448000 52000 211500 8000 62 276000 100000 176000 39500 496000 48000 220000 9000 60 329500 100000 229500 53500 540000 44000 210500 10000 58 400000 100000 300000 70500 580000 40000 180000Related Questions
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