Fix Show more Assume the following cost data are for a purely competitive producer: Total Product Average Fixed Cost Average Variable Cost Average Total Cost Marginal Cost 0 $0.00 $0.00 $0.00 1 $60 $45 $105 $45 2 30 42.5 72.5 40 3 20 40 60 35 4 15 37.5 52.5 30 5 12 37 49 35 6 10 37.5 47.5 40 7 8.57 38.57 47.14 45 8 7.5 40.63 48.13 55 9 6.67 43.33 50 65 10 6 46.5 52.5 75 Answer the questions in the first column in the table below for the price listed at the top of each of the other three columns. (a) At a product price of $66 (b) At a product price of $41 (c) At a product price of $32 Will this firm produce in the short run? (Click to select)YesNo (Click to select)YesNo (Click to select)NoYes If it is preferable to produce what will be the profit-maximizing or loss-minimizing output? (Click to select)Loss-minimizingProfit-maximizingNot applicable output = units per firm (Click to select)Profit-maximizingNot applicableLoss-minimizing output = units per firm (Click to select)Not applicableLoss-minimizingProfit-maximizing output = units per firm What economic profit or loss will the firm realize per unit of output? (Click to select)Not applicableLossProfit per unit = $ (Click to select)Not applicableLossProfit per unit = $ (Click to select)Total lossTotal profit = $ d. In the table below complete the short-run supply schedule for the firm (columns 1 and 2) and indicate the profit or loss incurred at each output (column 3). (1) Price (2) Quantity Supplied Single Firm (3) Profit or Loss (-) (4) Quantity Supplied 1500 Firms $22 $ 27 32 38 43 47 57 e. Now assume that there are 1500 identical firms in this competitive industry; that is there are 1500 firms each of which has the cost data shown in the table. Complete the industry supply schedule (column 4 in the above table). f. Suppose the market demand data for the product are as follows: Price Total Quantity Demanded $22 19000 27 17000 32 15000 38 13500 43 12000 47 10500 57 9500 What will be the equilibrium price? $ What will be the equilibrium output for the industry? For each firm? units What will profit or loss be per unit? (Click to select)ProfitLoss per unit = $ Per firm? $ Will this industry expand or contract in the long run? (Click to select)The industry will contract.The industry will expand. Show less
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