The table below shows the average cost (AC) for a purely competitive market. The average revenue (AR) is constant at RM5 per unit and the firm's total fixed cost (TFC) is RM4. Total Marginal Revenue (RM) Total Cost Marginal Cost (RM) Output Average Cost (Units) Revenue (RM) (RM) (RM) 1 8.0 2 5.5 3 4.0 4 3.5 3.8 4.5 7 6.0 a) Fill in the values for total revenue (TR), total cost (TC) and marginal cost (MC) in the column provided. b) Determine the profit maximizing output. c) Show the equilibrium of the firm in a diagram.

The table below shows the average cost (AC) for a purely competitive market. The average revenue (AR) is constant at RM5 per unit and the firm's total fixed cost (TFC) is RM4. Total Marginal Revenue (RM) Total Cost Marginal Cost (RM) Output Average Cost (Units) Revenue (RM) (RM) (RM) 1 8.0 2 5.5 3 4.0 4 3.5 3.8 4.5 7 6.0 a) Fill in the values for total revenue (TR), total cost (TC) and marginal cost (MC) in the column provided. b) Determine the profit maximizing output. c) Show the equilibrium of the firm in a diagram.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter11: Price And Output Determination: Monopoly And Dominant Firms

Section: Chapter Questions

Problem 3E

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