A. Very briefly, what is the significance of where marginal cost equals marginal revenue?B. When total revenue exceeds total cost, profits are?C. Is this firm earning an economic profit if it is operating at the profit-maximizing/loss minimizing output? (Yes or No)D. Below what price level would the firm shut-down? Complete Table Below (1-9):Sum all orthefixed costs fromPrice x Quatity above. TFCdoes not varyfrom unit toUnit variable Totalcost (average Variable Cost+ Total FixedCost TFC +|TVCTotalRevenue -Total CostTR - TCChange in|(TotalRevenue)|/(Change in|Quantity)|Change in|(Total Cost)/(Change inQuantity)Total Cost /QuantityTC / QTotalVariable Cost/ QuantityTVC / QBasic Formulavariable) xQuantityAVC x QPx QExcel formulas for the various functions: Usingthe power of Excel (first row formulas) use Fill-Down function to complete each column tosave yourself from creating a calculation ineach cell (very time-consuming). Ignore the :mark when creating the formulas. See thenext worksheet for instructios for using the fill-:=sum (d15- :=sum(g15-d14)/(c15-c14)g14)/(c15-c14):=b14*c14Enter figure:=50*C14:=e14+f14:=d14-g14:=g15/c15:=f15/c153) TotalVariable Cost4) Total Cost(TVC)6) MarginalRevenue (MR) Cost (MC)-$3508) AverageTotal Cost9) AverageVariable Cost(AVC)Price/Demand Curve(surfboards)1) Total Revenue 2) Total FixedCost (TFC)$3007) Marginal|Quantity$300$290(TR)(TC)5) Profit(ATC)1$60050$650$580$280$260350.0250.0200.0170.0150.02$600100$700-$12050.0050$600$600$90$280$2803$840150$75050.0050$2704200$240$1,080$1,300$1,500$1,680$1,840$1,980$2,100$2,200$2,280$2,340$2,380$2,400$2,400$2,380$2,340$2,280$2,200$2,100$80050.0050250$450$600$730$260$600$850$22050.0050$2506$600300$900$20050.005050$180$160$140$2407$600350$95050.00135.7$1,000$1,050$1,100$1,150$1,200$1,250$1,300$1,350$1,400$1,450$1,500$1,550$1,600400$8405050$2308$60050.00125.0450500$2209$600$93050.00116.7$1,000$1,050$1,080$1,090|$1,080$1,050$1,00010$120$100$210$60050.00110.050104.5550600$20011$60050.0050$80$60$40$20$05050$19012$60050.00100.0$18013$60065050.0096.2$17014$60070050.0092.950$16015$60075050.0090.0508005050$15016$60050.0087.5$14085.385090017$600$930-$2050.00$13018$600$840-$4050.0083.350$120950$730$600$45019$600-$6050.0081.650$11020$6001000-$8050.0080.050$10021$6001050$1,650-$10050.0078.65088::::8:::::8:::::88

Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Very briefly, what is the significance of where marginal cost equals marginal revenue? B. When total revenue exceeds total cost, profits are? C. Is this firm earning an economic profit if it is operating at the profit-maximizing/loss minimizing output? (Yes or No)

Very briefly, what is the significance of where marginal cost equals marginal revenue? B. When total revenue exceeds total cost, profits are? C. Is this firm earning an economic profit if it is operating at the profit-maximizing/loss minimizing output? (Yes or No)

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 21P

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Question

A. Very briefly, what is the significance of where marginal cost equals marginal revenue?

B. When total revenue exceeds total cost, profits are?

C. Is this firm earning an economic profit if it is operating at the profit-maximizing/loss minimizing output? (Yes or No)

D. Below what price level would the firm shut-down?

Complete Table Below (1-9):
Sum all orthe
fixed costs from
Price x Quatity above. TFC
does not vary
from unit to
Unit variable Total
cost (average Variable Cost
+ Total Fixed
Cost TFC +
|TVC
Total
Revenue -
Total Cost
TR - TC
Change in
|(Total
Revenue)
|/(Change in
|Quantity)
|Change in
|(Total Cost)
/(Change in
Quantity)
Total Cost /
Quantity
TC / Q
Total
Variable Cost
/ Quantity
TVC / Q
Basic Formula
variable) x
Quantity
AVC x Q
Px Q
Excel formulas for the various functions: Using
the power of Excel (first row formulas) use Fill-
Down function to complete each column to
save yourself from creating a calculation in
each cell (very time-consuming). Ignore the :
mark when creating the formulas. See the
next worksheet for instructios for using the fill-
:=sum (d15- :=sum(g15-
d14)/(c15-
c14)
g14)/(c15-
c14)
:=b14*c14
Enter figure
:=50*C14
:=e14+f14
:=d14-g14
:=g15/c15
:=f15/c15
3) Total
Variable Cost4) Total Cost
(TVC)
6) Marginal
Revenue (MR) Cost (MC)
-$350
8) Average
Total Cost
9) Average
Variable Cost
(AVC)
Price/Demand Curve
(surfboards)
1) Total Revenue 2) Total Fixed
Cost (TFC)
$300
7) Marginal
|Quantity
$300
$290
(TR)
(TC)
5) Profit
(ATC)
1
$600
50
$650
$580
$280
$260
350.0
250.0
200.0
170.0
150.0
2
$600
100
$700
-$120
50.00
50
$600
$600
$90
$280
$280
3
$840
150
$750
50.00
50
$270
4
200
$240
$1,080
$1,300
$1,500
$1,680
$1,840
$1,980
$2,100
$2,200
$2,280
$2,340
$2,380
$2,400
$2,400
$2,380
$2,340
$2,280
$2,200
$2,100
$800
50.00
50
250
$450
$600
$730
$260
$600
$850
$220
50.00
50
$250
6
$600
300
$900
$200
50.00
50
50
$180
$160
$140
$240
7
$600
350
$950
50.00
135.7
$1,000
$1,050
$1,100
$1,150
$1,200
$1,250
$1,300
$1,350
$1,400
$1,450
$1,500
$1,550
$1,600
400
$840
50
50
$230
8
$600
50.00
125.0
450
500
$220
9
$600
$930
50.00
116.7
$1,000
$1,050
$1,080
$1,090|
$1,080
$1,050
$1,000
10
$120
$100
$210
$600
50.00
110.0
50
104.5
550
600
$200
11
$600
50.00
50
$80
$60
$40
$20
$0
50
50
$190
12
$600
50.00
100.0
$180
13
$600
650
50.00
96.2
$170
14
$600
700
50.00
92.9
50
$160
15
$600
750
50.00
90.0
50
800
50
50
$150
16
$600
50.00
87.5
$140
85.3
850
900
17
$600
$930
-$20
50.00
$130
18
$600
$840
-$40
50.00
83.3
50
$120
950
$730
$600
$450
19
$600
-$60
50.00
81.6
50
$110
20
$600
1000
-$80
50.00
80.0
50
$100
21
$600
1050
$1,650
-$100
50.00
78.6
50
88::::8:::::8:::::88

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