The following data describe the firm's monthly demand and monthly costs fof a l of electronic components. 1. Complete the following cost and revenue schedules for this company. Average Variable Total Marginal Average Total Cost Marginal Cost per Variable Revenue per Cost for Cost per Quantity of boxes of Price per Total box of 1000 per box of box of 1000 1000 units box of units Fixed Total box of units Revenue units produced Cost 1000 units 1000 units 1000 units Cost $800 $800 $0 $1,700 $1,575 $1,450 1 $1,028 $1,074 3 $1,117 $1,325 $1,184 $1,200 $1,075 $950 $825 $1,303 $1,498 7 $1,753 8 $2,103 (a) What is the profit maximizing (or loss minimizing) quantity of boxesthat this company should supply? Why? (b) What price will the company charge? How is this price determined? Will this result in economic profits? (c) If the company charged a higher price than what you found in (b) above, what would happen? (d) What market structure do you think this company participates in? Why?
The following data describe the firm's monthly demand and monthly costs fof a l of electronic components. 1. Complete the following cost and revenue schedules for this company. Average Variable Total Marginal Average Total Cost Marginal Cost per Variable Revenue per Cost for Cost per Quantity of boxes of Price per Total box of 1000 per box of box of 1000 1000 units box of units Fixed Total box of units Revenue units produced Cost 1000 units 1000 units 1000 units Cost $800 $800 $0 $1,700 $1,575 $1,450 1 $1,028 $1,074 3 $1,117 $1,325 $1,184 $1,200 $1,075 $950 $825 $1,303 $1,498 7 $1,753 8 $2,103 (a) What is the profit maximizing (or loss minimizing) quantity of boxesthat this company should supply? Why? (b) What price will the company charge? How is this price determined? Will this result in economic profits? (c) If the company charged a higher price than what you found in (b) above, what would happen? (d) What market structure do you think this company participates in? Why?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:The following data describe the firm's monthly demand and monthly costs for a manufacturer
of electronic components.
1. Complete the following cost and revenue schedules for this company.
Total
Average
Marginal
Marginal
Cost per
Variable
Variable
Average
Price per
Cost per
Total Cost
Revenue per
Cost for
Quantity of
boxes of
per box of box of 1000
units
Total box of 1000
box of
units
Fixed
Total
box of
Revenue
units
1000 units 1000 units
produced
Cost
Cost 1000 units
1000 units
$0
$800
$800
$1,700
$1,575
$1,450
$1,325
1
$1,028
$1,074
$1,117
$1,184
$1,303
2
3
4
5
$1,200
6.
$1,075
$950
$1,498
7
$1,753
8
$825
$2,103
(a) What is the profit maximizing (or loss minimizing) quantity of boxesthat this company should supply? Why?
(b) What price will the company charge? How is this price determined? Will this result in economic profits?
(c) If the company charged a higher price than what you found in (b) above, what would happen?
(d) What market structure do you think this company participates in? Why?
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