Sub : EconomicsPls answer very fast.I ll upvote. Thank You 8. Problems and Applications Q8Henry Potter owns the only well in town that produces clean drinking water. He faces the following demand, marginal revenue, and marginal costcurves:Demand:P = 70-QMarginal Revenue: MR = 70-20Marginal Cost:MC = 10 + QOn the following graph, use the blue line (circle symbol) to graph Mr. Potter's demand curve. Then, use the black line (cross symbol) to graph hismarginal revenue (MR) curve. Next, use the orange line (square symbol) to graph his marginal cost (MC) curve. Finally, use the grey point (starsymbol) to indicate the profit-maximizing price and quantity.Price (Dollars)80706050403020100-10-20-30-40-50-60-70-80010203040Quantity (Units)506070DemandMR0MCProfit-Maximization The profit-maximizing quantity isMayor George Bailey, concerned about water consumers, is considering a price ceiling that is 10% below the monopoly price.At this new price, the quantity demanded would beAt this quantity, the marginal cost would beamount.units, and the profit-maximizing price is $O TrueGeorge's Uncle Billy says that a price ceiling is a bad idea because price ceilings cause shortages.O FalseTrue or False: A price ceiling that is 10% below the monopoly price would cause a shortage.units.At this price, the quantity demanded would bethe price. Therefore, the profit-maximizing Mr. PotterGeorge's friend Clarence, who is even more concerned about consumers, suggests a price ceiling 50% below the monopoly price.TrueFalseTrue or False: A price ceiling 50% below the monopoly price would cause shortage.units, and the quantity supplied would beunits.produce this

Marginal revenue is the additional revenue generated by selling one additional unit of a product or…

8. Problems and Applications Q8 Henry Potter owns the only well in town that produces clean drinking water. He faces the following demand, marginal revenue, and marginal cost curves: Demand: P=70-Q Marginal Revenue: MR = 70-20 Marginal Cost: MC=10+ Q On the following graph, use the blue line (circle symbol) to graph Mr. Potter's demand curve. Then, use the black line (cross symbol) to graph his marginal revenue (MR) curve. Next, use the orange line (square symbol) to graph his marginal cost (MC) curve. Finally, use the grey point (star symbol) to indicate the profit-maximizing price and quantity. 80 70 00 50 40 30 20 10 0 -10 20 -30 40 -40 40 -70 -40 10 20 30 40 Quantity (Units) 60 60 70 10 Demand MR 0 MC * Proft-Maximization ?

8. Problems and Applications Q8 Henry Potter owns the only well in town that produces clean drinking water. He faces the following demand, marginal revenue, and marginal cost curves: Demand: P=70-Q Marginal Revenue: MR = 70-20 Marginal Cost: MC=10+ Q On the following graph, use the blue line (circle symbol) to graph Mr. Potter's demand curve. Then, use the black line (cross symbol) to graph his marginal revenue (MR) curve. Next, use the orange line (square symbol) to graph his marginal cost (MC) curve. Finally, use the grey point (star symbol) to indicate the profit-maximizing price and quantity. 80 70 00 50 40 30 20 10 0 -10 20 -30 40 -40 40 -70 -40 10 20 30 40 Quantity (Units) 60 60 70 10 Demand MR 0 MC * Proft-Maximization ?

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 9PA

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Similar questions

The AAA Aquarium Co. sells aquariums for 20 each. Fixed costs of production are 20. The total variable costs are 20 for one aquarium, 25 for two units, 35 for the three units, 50 for four units, and 80 for five units. In the form of a table, calculate total revenue, marginal revenue, total cost, and marginal cost for each output level (one to five units). What is the Profit-maximizing quantity of output? On one diagram, sketch the total revenue and total cost curves. On another diagram, sketch the marginal revenue and marginal cost curves.
What two lines on a cost curve diagram intersect at the zero-profit point?
What two lines on a cost curve diagram intersect at the shutdown point?
Explain in words why a profit-maximizing film will not choose to produce at a quantity where marginal cost exceeds marginal revenue.
A computer company produces affordable, easy-to-use home computer systems and has fixed costs of 250. The marginal cost of producing computers is 700 for the first computer, 250 for the second, 300 for the third, 350 for the fourth, 430 for the fifth, 450 for the sixth, and 500 for the seventh. Create a table that shows the companys output, total cost, marginal cost, average cost, variable cost, and average variable cost. At what price is the zero-profit point? At what price is the shutdown point? If the company sells the computers for 500, is it making a profit or a loss? How big is the profit or loss? Sketch a graph with AC, MC, and AVG curves to illustrate your answer and show the profit or loss. If the firm sells the computers for 300, is it making a profit or a loss? How big is the profit or loss? Sketch a graph with AC, MC, and AVG curves to illustrate your answer and show the profit or loss.