Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by C= 300 + 2q, where q is the level of output and C is total cost. (The marginal cost of production, MC(q), is 4q; the fixed cost, FC, is $300). If the price of a watch is $80, how many watches should you produce to maximize profits? You should produce watches. (Enter your response as an integer.) What will the profit level be? Profit will be $ (Enter your response rounded to two decimal places.) At what minimum price will the firm produce a positive output? In the short run, the firm will produce if price is greater than $ per watch. (Enter your response as an integer.)

Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by C= 300 + 2q, where q is the level of output and C is total cost. (The marginal cost of production, MC(q), is 4q; the fixed cost, FC, is $300). If the price of a watch is $80, how many watches should you produce to maximize profits? You should produce watches. (Enter your response as an integer.) What will the profit level be? Profit will be $ (Enter your response rounded to two decimal places.) At what minimum price will the firm produce a positive output? In the short run, the firm will produce if price is greater than $ per watch. (Enter your response as an integer.)

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

Chapter9: Price Takers And The Competitive Process

Section: Chapter Questions

Problem 16CQ

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