nectly compettive market must figure order to maximize profits. This firm knows that the cost to rent office space for the month will be $3,000 and that each worker will cost $400 a month and the output per worker is given below. Knowing this information fill in the table and show how many workers the firm should hire to produce what quantity of output in order to maximize total profit. Workers Pay Output Price Total Revenue Fixed Cost Var. Cost Total Cost Marg. Cost Marg. Rev Total Profit 400 10 3,000 3,000 -3,000 3 10 400 170 1,700 3,000 440 3,440 -1,740 10 374 960 578 1,560 697 2,240 799 3,000 2.
nectly compettive market must figure order to maximize profits. This firm knows that the cost to rent office space for the month will be $3,000 and that each worker will cost $400 a month and the output per worker is given below. Knowing this information fill in the table and show how many workers the firm should hire to produce what quantity of output in order to maximize total profit. Workers Pay Output Price Total Revenue Fixed Cost Var. Cost Total Cost Marg. Cost Marg. Rev Total Profit 400 10 3,000 3,000 -3,000 3 10 400 170 1,700 3,000 440 3,440 -1,740 10 374 960 578 1,560 697 2,240 799 3,000 2.
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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Transcribed Image Text:Question 3: A firm in a perfectly competitive market must figure out at what level to produce in
order to maximize profits. This firm knows that the cost to rent office space for the month will be
$3,000 and that each worker will cost $400 a month and the output per worker is given below.
Knowing this information fill in the table and show how many workers the firm should hire to
produce what quantity of output in order to maximize total profit.
Workers
Pay
Output
Price
Total Revenue
Fixed Cost
Var. Cost
Total Cost Marg. Cost Marg. Rev
Total Profit
400
10
3,000
3,000
-3,000
3
10
1
400
170
1,700
3,000
440
3,440
-1,740
10
2
374
960
3
578
1,560
4
697
2,240
799
3,000
Transcribed Image Text:1
400
170
1,700
3,000
440
3,440
-1,740
10
2
374
960
3
578
1,560
4
697
2,240
799
3,000
6.
884
3,840
Fill in the blank spaces in the table and calculate:
Total Revenue, Variable Costs, Total Costs, Marginal Cost, Marginal Revenue and Total
Profit|
B)
How many workers should the firm hire to maximize total profits?
C)
What is the total quantity produced to maximize total profits?
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