Using the following table, for each price level, calculate the optimal quantity of units for the firm to produce. Using the data from the graph to determine the firm’s total variable cost, calculate the profit or loss associated with producing that quantity. Assume that if the firm is indifferent between producing and shutting down, it will choose to produce. (Hint: Select purple points [diamond symbols] on the graph to receive exact average variable cost information.) Price Quantity Total Revenue Fixed Cost Variable Cost Profit (Dollars per instant pot) (Instant pots) (Dollars) (Dollars) (Dollars) (Dollars) 25.00 1,600,000 70.00 1,600,000 100.00 1,600,000
Using the following table, for each price level, calculate the optimal quantity of units for the firm to produce. Using the data from the graph to determine the firm’s total variable cost, calculate the profit or loss associated with producing that quantity. Assume that if the firm is indifferent between producing and shutting down, it will choose to produce. (Hint: Select purple points [diamond symbols] on the graph to receive exact average variable cost information.) Price Quantity Total Revenue Fixed Cost Variable Cost Profit (Dollars per instant pot) (Instant pots) (Dollars) (Dollars) (Dollars) (Dollars) 25.00 1,600,000 70.00 1,600,000 100.00 1,600,000
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Using the following table, for each price level, calculate the optimal quantity of units for the firm to produce. Using the data from the graph to determine the firm’s total variable cost, calculate the profit or loss associated with producing that quantity. Assume that if the firm is indifferent between producing and shutting down, it will choose to produce. (Hint: Select purple points [diamond symbols] on the graph to receive exact average variable cost information.)
|
Price
|
Quantity
|
Total Revenue
|
Fixed Cost
|
Variable Cost
|
Profit
|
|---|---|---|---|---|---|
|
(Dollars per instant pot)
|
(Instant pots)
|
(Dollars)
|
(Dollars)
|
(Dollars)
|
(Dollars)
|
| 25.00 |
|
1,600,000 |
|
|
|
| 70.00 |
|
1,600,000 |
|
|
|
| 100.00 |
|
1,600,000 |
|
|
Transcribed Image Text:PRICE (Dollars per instant pot)
100
90
80
288
70
50
40
30
20
10
0
0 5
MC
D
ATC
AVC
10 15 20 25 30 35 40
QUANTITY (Thousands of instant pots)
45
50
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