Suppose Felix runs a small business that manufactures frying pans. Assume that the market for frying pans is a perfectly competitive market, and the market price is $20 per frying pan. The following graph shows Felix's total cost curve. Calculate Felix's marginal revenue and marginal cost for the first seven frying pans he produces and plot them on the following graph. Use the bluepoints (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost.Note: Plot quantity values between the integers. For example, if Felix's marginal cost of increasing production from one frying pan to two frying pansis z, then you would plot a point at (1.5, x). Points will snap to the quantities of output as well as the level of cost and revenue.4035Marginal Revenue30Marginal Cost103QUANTITY (Frying pans)245678Felix's profit is maximized when he producesfrying pans. When he does this, the marginal cost of the last frying pan he produces is, which isv than the price Felix receives for each frying pan he sells. The marginal cost of producing an additional frying pan(that is, one more frying pan than would maximize his profit) is s, which isv than the price Felix receives for each frying pan hesells. Therefore, Felix's profit-maximizing quantity corresponds to the intersection of thecurves. BecauseFelix is a price taker, this last condition can also be written asCOSTS AND REVENUE (Dollars per frying pan) Suppose Felix runs a small business that manufactures frying pans. Assume that the market for frying pans is a perfectly competitive market, and themarket price is $20 per frying pan.The following graph shows Felix's total cost curve.Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven frying pans that Felixproduces, including zero frying pans.Note: Points will snap to the quantities of output as well as level of profit and revenue.200175Total Revenue150Total Cost125Profit7525-2523578QUANTITY (Frying pans)Calculate Felix's marginal revenue and marginal cost for the first seven frying pans he produces and plot them on the following graph. Use the bluepoints (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost.Note: Plot quantity values between the integers. For example, if Felix's marginal cost of increasing production from one frying pan to two frying pansis a, then you would plot a point at (1.5, x). Points will snap to the quantities of output as well as the level of cost and revenue.O TAL COST AND REVENUE (Dollars)

We are going to use microeconomic concepts such as profit maximisation, perfect competition to…

Calculate Felix's marginal revenue and marginal cost for the first seven frying pans he produces and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost. Note: Plot quantity values between the integers. For example, if Felix's marginal cost of increasing production from one frying pan to two frying pans is z, then you would plot a point at (1.5, x). Points will snap to the quantities of output as well as the level of cost and revenue. 40 35 Marginal Revenue 30 Marginal Cost 15 10 1 5 8 QUANTITY (Frying pans) Felix's profit is maximized when he produces frying pans. When he does this, the marginal cost of the last frying pan he produces is ▼ than the price Felix receives for each frying pan he sells. The marginal cost of producing an additional frying pan which is (that is, one more frying pan than would maximize his profit) isS , which is than the price Felix receives for each frying pan he sells. Therefore, Felix's profit-maximizing quantity corresponds to the intersection of the v curves. Because Felix is a price taker, this last condition can also be written as COSTS AND REVENUE (Dollars per frying pan) 유

Calculate Felix's marginal revenue and marginal cost for the first seven frying pans he produces and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost. Note: Plot quantity values between the integers. For example, if Felix's marginal cost of increasing production from one frying pan to two frying pans is z, then you would plot a point at (1.5, x). Points will snap to the quantities of output as well as the level of cost and revenue. 40 35 Marginal Revenue 30 Marginal Cost 15 10 1 5 8 QUANTITY (Frying pans) Felix's profit is maximized when he produces frying pans. When he does this, the marginal cost of the last frying pan he produces is ▼ than the price Felix receives for each frying pan he sells. The marginal cost of producing an additional frying pan which is (that is, one more frying pan than would maximize his profit) isS , which is than the price Felix receives for each frying pan he sells. Therefore, Felix's profit-maximizing quantity corresponds to the intersection of the v curves. Because Felix is a price taker, this last condition can also be written as COSTS AND REVENUE (Dollars per frying pan) 유

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter23: Profit Maximization

Section: Chapter Questions

Problem 1E

See similar textbooks

Similar questions

Suppose Rina runs a small business that manufactures frying pans. Assume that the market for frying pans is a competitive market, and the market price is $20 per frying pan. The following graph shows Rina's total cost curve. On the graph below, use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven frying pans that Rina produces, including zero frying pans. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 25 0 -25 □ 0 1 U 2 ■ U 3 4 5 QUANTITY (Frying pans) n 6 Total Cost 7 8 Total Revenue Profit ?
Suppose Tim runs a small business that manufactures frying pans. Assume that the market for frying pans is a price-taker market, and the market price is $20 per frying pan. The following graph shows Tim's total cost curve. Use the blue points (circle symbol) to plot total revenue, and the green points (triangle symbol) to plot profit for the first seven frying pans that Tim produces, including zero frying pans. 175 150 Total Revenue 125 Total Cost 100 Profit -25 -50 3 QUANTITY (Frying pans) 1 4 8 the firrt ceren foring nans he produces, and plot them on the following graph. Use the blue TOTAL COST AND REVENUE (Dollars)
Suppose Rosa runs a small business that manufactures teddy bears. Assume that the market for teddy bears is a competitive market, and the market price is $20 per teddy bear. The following graph shows Rosa's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven teddy bears that Rosa produces, including zero teddy bears. 200 175 Total Revenue 150 125 Total Cost Profit 100 75 50 25 -25 1 3 4. 8 QUANTITY (Teddy bears) TOTAL COST AND REVENUE (Dollars)
Suppose Megan runs a small business that manufactures teddy bears. Assume that the market for teddy bears is a competitive market, and the market price is $25 per teddy bear. The following graph shows Megan's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven teddy bears that Megan produces, including zero teddy bears. 200 T 175 150 125 100 75 50 0 -25 35 30 20 15 10 5 0 0 D 0 1 2 1 C 2 D ☐ 3 4 5 QUANTITY (Teddy bears) Calculate Megan's marginal revenue and marginal cost for the first seven teddy bears she produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost. (?) 0 3 4 5 QUANTITY (Teddy bears) 6 Total Cost 0 6 7 8 7 O 8 Total Revenue A Profit O (?) Marginal Revenue Marginal Cost Megan's profit is maximized when she produces teddy bears. When she does this, the marginal cost…
Suppose Jake runs a small business that manufactures frying pans. Assume that the market for frying pans is a competitive market, and the market price is $20 per frying pan. The following graph shows Jake's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for frying pans quantities zero through seven (inclusive) that Jake produces. 200 175 Total Revenue 150 Total Cost 125 Profit 100 75 50 25 -25 1 2 6 8 QUANTITY (Frying pans) Calculate Jake's marginal revenue and marginal cost for the first seven frying pans he produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity. (? 40 35 Marginal Revenue 30 25 Marginal Cost 20 15 1 2 3 4 5 6. QUANTITY (Frying pans) Jake's profit is maximized when he produces frying pans. When he does this, the marginal cost of the last frying pan he…
Suppose Rosa runs a small business that manufactures frying pans. Assume that the market for frying pans is a perfectly competitive market, and the market price is $20 per frying pan. The following graph shows Rosa's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for the first seven frying pans that Rosa produces, including zero frying pans.
Suppose Larry runs a small business that manufactures shirts. Assume that the market for shirts is a competitive market, and the market price is $20 per shirt. The following graph shows Larry's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for shirts quantities zero through seven (inclusive) that Larry produces. Calculate Larry's marginal revenue and marginal cost for the first seven shirts he produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity. Larry's profit is maximized when he produces shirts. When he does this, the marginal cost of the last shirt he produces is , which is than the price Larry receives for each shirt he sells. The marginal cost of producing an additional shirt (that is, one more shirt than would maximize his profit) is , which is…
Suppose Dmitri runs a small business that manufactures frying pans. Assume that the market for frying pans is a competitive market, and the market price is $20 per frying pan. The following graph shows Dmitri's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for frying pans quantities zero through seven (inclusive) that Dmitri produces. Dmitri's profit is maximized when he produces frying pans. When he does this, the marginal cost of the last frying pan he produces is , which is than the price Dmitri receives for each frying pan he sells. The marginal cost of producing an additional frying pan (that is, one more frying pan than would maximize his profit) is , which is than the price Dmitri receives for each frying pan he sells. Therefore, Dmitri's profit-maximizing quantity corresponds to the intersection of the curves. Because Dmitri is a price taker, this last condition…
3. Profit maximization using total cost and total revenue curves Suppose Cho runs a small business that manufactures frying pans. Assume that the market for frying pans is a competitive market, and the market price is $25 per frying pan. The following graph shows Cho's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for frying pans quantities zero through seven (inclusive) that Cho produces. 200 175 Total Revenue 150 Total Cost 125 Profit 100 75 50 25 -25 1 2 3 4 7 8 QUANTITY (Frying pans) Calculate Cho's marginal revenue and marginal cost for the first seven frying pans she produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity. TOTAL COST AND REVENUE (Dollars)
3. Profit maximization using total cost and total revenue curves Suppose Rian operates a handicraft pop-up retail shop that sells rompers. Assume a perfectly competitive market structure for rompers with a market price equal to $20 per romper. TH The following graph shows Rian's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for rompers for quantities zero through seven (including zero and seven) that Rian produces. TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 25 -25 DO 0 1 2 3 5 QUANTITY (Rompers) 4 6 Total Cost 7 8 Total Revenue Profit ?
Suppose Rian operates a handicraft pop-up retail shop that sells rompers. Assume a perfectly competitive market structure for rompers with a market price equal to $25 per romper. The following graph shows Rian's total cost curve. Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for rompers for quantities zero through seven (including zero and seven) that Rian produces. Ⓡ? TOTAL COST AND REVENUE (Dollars) 200 175 150 125 100 75 50 # QUANTITY (Rompers) Total Cost Total Revenue A Profit
Calculate Rian's marginal revenue and marginal cost for the first seven rompers they produce, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity.