A perfectly competitive firm faces the short-run cost schedule shown in Table 1. Output 1 2 4 7 Total Cost 12 26 32 40 52 68 93 122 Table 1 A) Calculate average total cost (ATC=TC/Q), marginal cost (MC=ATCIAQ) and marginal revenue (MR=ATRIAQ) for each level of output. The price per unit of output is £16. B) Plot ATC, MC and MR on a graph and mark the profit-maximising output. At what output is profit maximised? C) How much profit/loss is made at the optimum level of output? Co 3. 20

A perfectly competitive firm faces the short-run cost schedule shown in Table 1. Output 1 2 4 7 Total Cost 12 26 32 40 52 68 93 122 Table 1 A) Calculate average total cost (ATC=TC/Q), marginal cost (MC=ATCIAQ) and marginal revenue (MR=ATRIAQ) for each level of output. The price per unit of output is £16. B) Plot ATC, MC and MR on a graph and mark the profit-maximising output. At what output is profit maximised? C) How much profit/loss is made at the optimum level of output? Co 3. 20

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.4P

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