Price and costs (dollar) 16 12 0 90 130 MC ATC 210 170 Quantity (units per day! MR The figure above shows the marginal revenue and costs of a perfectly competitive firm. How many units the firm should produce to maximize its profit?
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- The revenue for a product is R(x) = - 0.004x2 + 21x – 6200 and the cost is C(x) = 0.02x + 38 for x units produced and sold. 1. Find the marginal profit for 2800 units. 2. Should output be increased or decreased to generate a higher profit?The equilibrium rent on office space has just increased by $500/month. Compare the effects on accounting profit and economic profit if: a. You rent your office b. You own your office spaceBette's Breakfast, a perfectly competitive eatery, sells its "Breakfast Special" (the only item on the menu) for $5.00. The costs of waiters, cooks, power, food etc. average out to $3.95 per meal; the costs of the lease, insurance and other such expenses average out to $1.25 per meal. Bette should:
- looking for help with this homework question... I'm not sure if wages, owners salary, job offer salary gets deducted or added for following question? Calculate the firm's economic profit. Revenue = $425,000 Raw materials = $60,000 Utilities = $20,000 Wages = $100,000 Owner's Salary = $95,000 Potential Rent from Building = $50,000 Job offer salary = $90,000Software Plus has a patent on software that estimates economic damages for clients involved in maritime injury lawsuits. Consumer demand is Quantity = 287.5 - 12.5P. Software cost $985. Producing a copy of the software is $11 per unit. a. How many copies of the software should I attempt to sell? At what price should I sell it? How much profit would I make?Disney just raised its 3 day 3 park pass from $110.00 to $121.00. Sales fell from 4,000 per week to 3,000 per week. Did Disney management do the right thing? Why? What should they do next? (Hint – look at revenues)
- The firm producing 6 units iPhone in a hour and selling it at $500. What is firm total revenue.You are currently in a job as a chef in a restaurant earning $100,000 per year. You are considering opening up a restaurant in a building which you currently own. You estimate that, if you wanted to, you could rent out your building for $25,000 per year to another restaurant. Last year, your revenues and expenses from the restaurant were the following: Revenues $400,000Cost of Food $120,000Salaries/Wages $100,000Utilities $25,000Taxes $20,000 What is your accounting profit? Show your calculations What is your economic profit? Show your calculations Assuming that you are indifferent between being a chef or owning a restaurant, should you open up your restaurant? Explain why. Now suppose that instead of owning the building where your restaurant will be located, you had to pay rent of $25,000 per year for the building. Will your answers to parts 1-3 change? Show your calculations. Explain how and why your answers will change or…Opal & Co. produced and sold 500 dog beds. The average cost of production per bed was $50. Each dog bed sold for a price of $65. Suppose regulations increased per unit cost by $5 per bed. Opal & Co’s total profit: a. Increased by $5,000 b. Decreased by $5,000 c. Increased by $2,500 d. Decreased by $2,500
- 28 Multiple Choice refers to the price at which a business turns a profit. Producer surplus Breakeven point Consumer surplus Opportunity costsA competitive firm faces the following market price: P=200. Variable costs are C(Q)=Q^2. The firm also pays $17000 in costs that do not depend on production (even if q=0). Hint – marginal cost is MC(Q)=2*Q NOTE - KEEP YOUR CALCULATIONS. THIS INFORMATION WILL BE USED IN MULTIPLE QUESTIONS What is the profit of this firm (ACCOUNTING profit, counting sunk costs as well) Question 7 options: 5000 0 -7000 -17000Multiple choice - microeconomics 39) A profit-maximizing firm in a competitive market produces small rubber balls. When the market price for small rubber balls falls below the minimum of its average total cost but still lies above the minimum of average variable cost, what happens to the firm? A. It will experience losses, but it will continue to produce rubber balls. B. It will be earning only accounting profits. C. It will be earning both economic and accounting profits. D. It will shut down. 38)