3. The table below gives the total costs and total revenue schedule for a firm with the ability to set prices. Quantity Total Revenue Total Costs 0 $0 $55.00 1 $87.50 $112.00 2 $150.00 $151.00 3 $187.50 $179.00 4 $200.00 $206.00 5 $187.50 $261.00 6 $150.00 $361.00 7 $87.50 $575.00 (a) Calculate and graph marginal revenue, marginal cost, and the demand curve. (b) Determine the profit-maximizing price and quantity, and calculate the resulting profit. (Assume that the firm can only produce whole (not fractional) units.) (c) Label the elastic, inelastic, and unit elastic regions of the demand curve.
3. The table below gives the total costs and total revenue schedule for a firm with the ability to set prices. Quantity Total Revenue Total Costs 0 $0 $55.00 1 $87.50 $112.00 2 $150.00 $151.00 3 $187.50 $179.00 4 $200.00 $206.00 5 $187.50 $261.00 6 $150.00 $361.00 7 $87.50 $575.00 (a) Calculate and graph marginal revenue, marginal cost, and the demand curve. (b) Determine the profit-maximizing price and quantity, and calculate the resulting profit. (Assume that the firm can only produce whole (not fractional) units.) (c) Label the elastic, inelastic, and unit elastic regions of the demand curve.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter8: Perfect Competition
Section: Chapter Questions
Problem 39P: The AAA Aquarium Co. sells aquariums for 20 each. Fixed costs of production are 20. The total...
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