Because of increasing marginal cost, most supply curvesA) are horizontal. B) have a negative slope. C) are vertical. D) have a positive slope.
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Because of increasing marginal cost, most supply curves
A) are horizontal.
B) have a negative slope.
C) are vertical.
D) have a positive slope.
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- In the short run , a profit -maximizing firm will produce additional units of a product as long as- a) price at least covers average fixed cost b) total revenue is increasing c) a change in the rate of technical substitution d) elasticity of demand is infinite e) price at least covers average variable costOptimal Price. Last week, Wally's Burgers, Inc. reduced the average price on the 1/2-pound Papa burger by 1%. In response, sales jumped by 2%.A. Calculate the point price elasticity of demand for Papa burgers.B. Calculate the optimal price for Papa burgers if marginal cost is $1 per unit.Inverse demand function for a firm is P(Q) = 100 -2q and the cost function is represented as C(q) = 10+2q. Find the profit maximizing output for this firm as well as the price. What is the maximum level of profits?
- A profit-maximizing firm in a competitive market is currently producing 100 units of output. It has average revenue of $10, average total cost of $8, and fixed cost of $200. What is its profit? What is its marginal cost? What is its average variable cost?Bavarian Crystal Works designs and produces crystal wine decanters for export to international markets. The marketing manager of Bavarian Crystal Works estimates the demand curve for each month to be: P=1,000-0.0025Q Where Q is the number of wine decanters produced monthly. Bavarian Crystal Works also pays a lease for its factory and equipment every month in the amount of $1,000,000. Finally, the cost to produce each wine decanter is $200. What quantity would maximize profits? What is the optimal price for Bavarian Crystals to charge?Assume that the cost curves in the attached figure apply to all firms in an industry. Then, if the initial price is P1, in the long run:a. Market demand will increaseb. Market demand will fallc. Market supply will growd. Market supply will fall.
- If Jim’s Home Goods price elasticity of demand is −2, and its profit maximizing price is $6, then its: average cost is $3.00. average cost is $0.33. marginal cost is $3.00. marginal cost is $0.33. average cost is $5.67.Find Marginal cost= Firms profit maximizing level= Profit at this output level= As a result firms will _. This will cause the market supply to __. This will continue until the price is equal to the minimum average cost of $_The firm's short-run supply curve shows the relationship between the price of a good and the: A. firms capacity output. B. quantity demanded of that good. C. willingness of consumers to purchase a good D. quantity supplied of that good.
- Explain the law of supply and a firm’s cost structure.A firm's faces a constant output price of $5. It produces 37 units and incurs a MC of $3. Which of the following is true? Select all that apply. A. The firm is perfectly competitive because it faces a horizontal straight line demand curve. B. The firm is perfectly competitive because it faces a horizontal straight line Average Revenue graph. C. The firm's marginal revenue is $5. D. The firm's Total Revenue equals $185. E. The firm's Total Cost equals $111.A perfectly competitive firm's short−runsupply curve is A. perfectly elastic at the market price. B. upward sloping and is the portion of the marginal cost curve that lies above the average variable cost curve. C. upward sloping and is the portion of the marginal cost curve that lies above the average total cost curve. D. horizontal at the minimum average total cost.
