Samurai Sam's, a producer of frozen sushi, is a monopolistically competitive firm. The firm is currently selling frozen California rolls at a $4 price. Samurai Sam's marginal cost is $1.75 and its marginal revenue is $1.50. The firm should ________ to maximize profits in the short run. Question 7Answer a. continue to produce the same output level b. decrease output to where marginal revenue just equals marginal cost c. increase output to where marginal revenue just equals marginal cost d. Indeterminate from the given information.

Samurai Sam's, a producer of frozen sushi, is a monopolistically competitive firm. The firm is currently selling frozen California rolls at a $4 price. Samurai Sam's marginal cost is $1.75 and its marginal revenue is $1.50. The firm should ________ to maximize profits in the short run. Question 7Answer a. continue to produce the same output level b. decrease output to where marginal revenue just equals marginal cost c. increase output to where marginal revenue just equals marginal cost d. Indeterminate from the given information.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter10: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 4QFR

See similar textbooks

Similar questions

Rebecca owns Louisiana Sugar Company, a manufacturer of sugar. Since there are lots of domestic manufacturers and importers of sugar and it is difficult to practice brand differentiation, the sugar industry is highly competitive. Suppose the demand for sugar increases. (1) What will be the effect on the market price and quantity of sugar in the short run and in the long run? Explain why. (2) What will happen to the economic profits of Louisiana Sugar Company in the short run and in the long run? Explain why.
The figure below shows the demand (D, MR) and cost (MC, ATC) curves for the Hand Made Shirt Shop operating in the monopolistically competitive personalized sweatshirts industry. Price per unit Number of personalized sweatshirts MC 18 0 MR D 50 70 75 Units of output ATC According to the figure above, what is the minimum fixed cost consistent with the firm choosing to remain open in the short run? a. $1,150 b. The firm would continue to operate regardless of the level of fixed costs. c. $1,250 d. $100
Kyrie owns a company in a competitive market that generates $800 in total revenue and has a marginal revenue of $20. If Kyrie is maximizing profit what quantity of goods are being sold and at what price? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a 20 units are being sold at a price of $40. b 20 units are being sold at a price of $20. 40 units are being sold at a price of $80. d. 40 units are being sold at a price of $20. e 80 units are being sold at a price of $20. f 80 units are being sold at a price of $40.
Kali is a dot-com entrepreneur who has established a Web site at which people can design and buy aring. Kali pays $600 a month for a Web server and Internet connection. The rings that customers design are made to order by another firm, and Kali pays this firm $20 a ring. Kali has no other costs. The table shows the demand schedule for Kali's rings. What is Kali's profit-maximizing output, price, and economic profit? Price (dollars per ring) 100 Quantity (rings per month) 0 80 20 60 40 40 60 20 80 0 100 Kali's profit-maximizing output is rings a month. Kali's profit-maximizing price is $ a ring. Kali's economic profit is $ a month.
Kyrie owns a company in a competitive market that generates $800 in total revenue and has a marginal revenue of $20. If Kyrie is maximizing profit what quantity of goods are being sold and at what price? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a 20 units are being sold at a price of $40. b 20 units are being sold at a price of $20. 40 units are being sold at a price of $80. d 40 units are being sold at a price of $20. 80 units are being sold at a price of $20. e 80 units are being sold at a price of $40.
Sparkle is one firm of many in the market for toothpaste, which is in long-run equilibrium. Indicate which of the following graphs accurately reflects Sparkle's demand curve, marginal-revenue (MR) curve, average-total-cost (ATC) curve, and marginal-cost (MC) curve. A B Demand Demand ATC ATC MC MC MR MR Quantity of Sparkle Toothpaste Quantity of Sparkle Toothpaste O A O B Price, Cost, Revenue Price, Cost, Revenue
The table below shows the total cost (TC) and marginal cost (MC) for Choco Lovers, a purely competitive firm producing different quantities of chocolate gift boxes. The market price for a box of chocolates is $10 per box. Instructions: Enter your answers as a whole number. a. Fill in the marginal revenue (MR) and average revenue (AR) columns. Choco Lovers Cost and Revenue Quantity TC MC MR AR of Gift Boxes ($) ($) ($) ($) 25 205 7 30 237 6.50 35 272 7 40 312 8 45 362 10 50 422 12 Instructions: For profit/loss, round your answers to two decimal places. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. A loss should be entered as a negative number. b. Given a price of $10 per gift box, how many boxes of chocolate should Choco Lovers produce? gift boxes What will the profit or loss be per gift box? $ per gift box c. Suppose that Choco Lovers raises the price to $12 per gift box. Now how many boxes should Choco Lovers produce? gift…
Fill the table below given Perfect Competition Conditions Quantity Demanded/ Produced Total Cost Average Fixed Cost Marginal Cost Average Total Cost Average Variable Cost Total Revenue Price=90 Profit 0 $300 -- -- 1 $310 2 $330 3 $360 4 $400 5 $450 6 $510 7 $580 8 $660 9 $750 10 $850 Calculate the Marginal and Average Costs. Calculate the Total Revenue. Draw the Average, and Marginal cost functions. Draw the Marginal Revenue Curve. Where do they meet and at what level of output? At what level is profit maximized? What are total revenue, total cost and the total amount of profit at that level?
The figure shows the situation facing Smart Digit, Inc., a firm in monopolistic competition that produces calculators. What is the firm's profit-maximizing price? OA. $10 B. $4 OC. $8 OD. $12
The table below shows the total cost (TC) and marginal cost (MC) for Choco Lovers, a purely competitive firm producing differe quantities of chocolate gift boxes. The market price for a box of chocolates is $4 per box. Instructions: Enter your answers as a whole number. a. Fill in the marginal revenue (MR) and average revenue (AR) columns. Choco Lovers Cost and Revenue Quantity TC MC MR AR of Gift Boxes ($) ($) ($) ($) 55 1 10 57 0.50 15 62 1 20 72 25 92 4 30 122 6.
Delilah's Daisies is a flower shop operating in the perfectly competitive flower industry. Delilah's chooses the optimal quantity of bouquets to sell by setting marginal revenue equal to marginal cost, which occurs when the quantity of bouquets is 10. At that quantity, Delila's average variable costs are $3 and average fixed costs are $4. If the price of a boquet is $6, what strategy is both feasible and optimal for Delilah in the short run? O Shut down and pay fixed costs. O Operate with a loss. Shut down and pay variable costs. O Operate with a profit.
Kindly answer all 3 little mcq questions Question: A firm operating in a perfectly competitive environment faces the following costs and revenues: ATC = $8; AVC = $4; and MR = MC = $6. This firm should: Shut down Decrease production and raise its Increase Continue to operate Ques: In the long run the demand curve that a monopolistic competitor faces for its product will likely: Intersect the ATC at its minimum Intersect the ATC curve somewhere past the minimum Become tangent to the ATC curve somewhere left of its minimum None of the Ques Monopolistically competitive firms are most likely to have profits: That are higher than competitive firms’ profit in the long Higher in the long run than in the short Zero in the long run Equal to the profit of a