Quantity per period1420a) At the optimal output, what price will Do Drop In charge and what will be its output?Price: $Output:b) At the optimal price and output, what will be its total revenue, total cost, and total loss?TR. STC: $Total loss: $cy If this firm made a rational decision to continue to produce, despite the loss, average variable cost must be below what level?AVC must be less than $units6 of 6SAMSUNGWext AC The graph shown below is that of Do Drop In, a shop in the dry-cleaning industry.Cost and revenues (in dollars)20181614121060MR120 180 240MCDQuantity per periodAC300 360 420

A firm produces at MR = MC to maximize the profit. i.e., At MR = MC, a firm maximizes the profit.…

a) At the optimal output, what price will Do Drop In charge and what will be its output? Price: $ Output: b) At the optimal price and output, what will be its total revenue, total cost, and total loss? TR: S TC: $ units

a) At the optimal output, what price will Do Drop In charge and what will be its output? Price: $ Output: b) At the optimal price and output, what will be its total revenue, total cost, and total loss? TR: S TC: $ units

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Quantity per period
1420
a) At the optimal output, what price will Do Drop In charge and what will be its output?
Price: $
Output:
b) At the optimal price and output, what will be its total revenue, total cost, and total loss?
TR. S
TC: $
Total loss: $
cy If this firm made a rational decision to continue to produce, despite the loss, average variable cost must be below what level?
AVC must be less than $
units
6 of 6
SAMSUNG
Wext A
C

The graph shown below is that of Do Drop In, a shop in the dry-cleaning industry.
Cost and revenues (in dollars)
20
18
16
14
12
10
60
MR
120 180 240
MC
D
Quantity per period
AC
300 360 420

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