Principles of Microeconomics, California Edition
2nd Edition
ISBN: 9780393622102
Author: Dirk Mateer, Lee Coppock
Publisher: NORTON
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Chapter 8, Problem 7SP
To determine
Describe the possibility of the given statement.
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Your product's revenue per unit is $30, and product's cost per unit is $10. If the demand for next month is 200 units, and it costs $1000 one time to set up the machine, what is our profit (in dollars) for next month?
If a company's marginal revenue is greater than its marginal cost, then the company should
You run a game-day shuttle service for parking services for the local ball club. Suppose you are compensated $30 per customer, per ride. In other words, your marginal revenue is $30. Your costs for different customer loads are summarized in the following table.
For each customer load, calculate both the marginal cost and the average cost. Then answer the question that follows.
Note: Round your answers to the nearest cent.
Customers
Total Cost
Marginal Cost
Average Cost
($)
($ per customer)
($ per customer)
1
$30
2
$36
3
$48
4
$66
5
$90
6
$120
7
$156
8
$198
In order to maximize profits, you should carry customers per load.
Chapter 8 Solutions
Principles of Microeconomics, California Edition
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