1. Fill in the table below. (4 points) Output Price TR MR TC MC 0 400 0 --------
ID: 2443976 • Letter: 1
Question
1. Fill in the table below. (4 points)
Output
Price
TR
MR
TC
MC
0
400
0
------------
200
---------
1
400
400
300
2
1000
500
3
600
1800
700
4
2800
1000
5
800
4000
1400
6
5400
1600
a. What is the profit maximizing output level? (2 points)
b. What is the profit per unit? (Price-ATC) Show all necessary work. (3 points)
c. What is the economic profit? Show all necessary work. (3 points)
Output
Price
TR
MR
TC
MC
0
400
0
------------
200
---------
1
400
400
300
2
1000
500
3
600
1800
700
4
2800
1000
5
800
4000
1400
6
5400
1600
Explanation / Answer
ANSWER:
mr = change in total revenue / change in quantity
mc = change in total cost / change in quantity
atc = total cost / no of units
OUTPUT PRICE TR MR TC MC 0 400 0 - 200 - 1 400 400 400 300 2 500 1000 300 500 3 600 1800 266.67 700 4 700 2800 250 1000 5 800 4000 240 1400 6 900 5400 233.33 1600Related Questions
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