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Question 1 Suppose there is only one supplier in the market of product X. The following table shows partial information of product X and the supplier's cost. Marginal Cost Price Quantity $1,700 1,500 1,400 1,300 1,200 1,100 1,000 0 1 380 2 390 3 410 430 5 460 6 500 900 7 550 800 610 8 700 9 770 600 10 790 A. Determine the supplier's profit-maximizing output quantity. Explain your answer. B. At what price should the supplier charge to maximize its profit? Explain your answer. C. Suppose at the profit-maximizing output quantity you have determined in part A, the average variable cost is $428.33 and the average total cost is $628.33. Calculate the total profit at the profit-maximizing output quantity

Question 1 Suppose there is only one supplier in the market of product X. The following table shows partial information of product X and the supplier's cost. Marginal Cost Price Quantity $1,700 1,500 1,400 1,300 1,200 1,100 1,000 0 1 380 2 390 3 410 430 5 460 6 500 900 7 550 800 610 8 700 9 770 600 10 790 A. Determine the supplier's profit-maximizing output quantity. Explain your answer. B. At what price should the supplier charge to maximize its profit? Explain your answer. C. Suppose at the profit-maximizing output quantity you have determined in part A, the average variable cost is $428.33 and the average total cost is $628.33. Calculate the total profit at the profit-maximizing output quantity

Microeconomics: Private and Public Choice (MindTap Course List)
Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter11: Price-searcher Markets With High Entry Barriers
Section: Chapter Questions
Problem 14CQ
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Question 1 Suppose there is only one supplier in the market of product X. The following table shows partial information of product X and the supplier's cost. Marginal Cost Price Quantity $1,700 1,500 1,400 1,300 1,200 1,100 1,000 0 1 380 2 390 3 410 430 5 460 6 500 900 7 550 800 610 8 700 9 770 600 10 790 A. Determine the supplier's profit-maximizing output quantity. Explain your answer. B. At what price should the supplier charge to maximize its profit? Explain your answer. C. Suppose at the profit-maximizing output quantity you have determined in part A, the average variable cost is $428.33 and the average total cost is $628.33. Calculate the total profit at the profit-maximizing output quantity
Transcribed Image Text:Question 1 Suppose there is only one supplier in the market of product X. The following table shows partial information of product X and the supplier's cost. Marginal Cost Price Quantity $1,700 1,500 1,400 1,300 1,200 1,100 1,000 0 1 380 2 390 3 410 430 5 460 6 500 900 7 550 800 610 8 700 9 770 600 10 790 A. Determine the supplier's profit-maximizing output quantity. Explain your answer. B. At what price should the supplier charge to maximize its profit? Explain your answer. C. Suppose at the profit-maximizing output quantity you have determined in part A, the average variable cost is $428.33 and the average total cost is $628.33. Calculate the total profit at the profit-maximizing output quantity
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