d. For each of the first 50 units, does MR exceed MC? (Click to select) Is MR > MC for units 51 and higher? (Click to select) e. What output level will yield the largest possible profit for this purely competitive firm? units
d. For each of the first 50 units, does MR exceed MC? (Click to select) Is MR > MC for units 51 and higher? (Click to select) e. What output level will yield the largest possible profit for this purely competitive firm? units
Chapter7: Perefect Competition
Section: Chapter Questions
Problem 6SQP
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Solve D and E only in typed answer
Transcribed Image Text:d. For each of the first 50 units, does MR exceed MC?
(Click to select)
Is MR > MC for units 51 and higher?
(Click to select)
e. What output level will yield the largest possible profit for this purely competitive firm?
units
Transcribed Image Text:05
A purely competitive firm finds that the market price for its product is $20. It has a fixed cost of $100 and a variable cost of $17.50 per
unit for the first 50 units and then $27.50 per unit for all successive units.
Instructions: Enter your answers rounded to two decimal places.
a. Does price equal or exceed average variable cost for the first 50 units?
AMA
(Click to select)
What is the average variable cost for the first 50 units?
$
per unit
b. Does price equal or exceed average variable cost for the first 100 units?
(Click to select)
What is the average variable cost for the first 100 units?
per unit
c. What is the marginal cost per unit for the first 50 units?
$
per unit
The marginal cost for units 51 and higher?
per unit
d. For each of the first 50 units, does MR exceed MC?
(Click to select)
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