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    Cs 28

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    Ammar Akhter Uz Zaman
    1. The table shows production quantities (Q), average variable costs (AVC), average costs (AC), marginal costs (MC), price (P), marginal revenue (MR), total revenue (TR), total costs (TC) and profits for a firm. 2. Total profit for the firm is Rs. 108.72, so the firm will enjoy economic profits. 3. For the second table with a lower price of Rs. 35, total profit is negative Rs. 36.4. So the firm must shutdown its operations.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Cs 28

    Uploaded by

    Ammar Akhter Uz Zaman
    7 views1 page
    1. The table shows production quantities (Q), average variable costs (AVC), average costs (AC), marginal costs (MC), price (P), marginal revenue (MR), total revenue (TR), total costs (TC) and profits for a firm. 2. Total profit for the firm is Rs. 108.72, so the firm will enjoy economic profits. 3. For the second table with a lower price of Rs. 35, total profit is negative Rs. 36.4. So the firm must shutdown its operations.

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    cs28

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    1. The table shows production quantities (Q), average variable costs (AVC), average costs (AC), marginal costs (MC), price (P), marginal revenue (MR), total revenue (TR), total costs (TC) and profits for a firm. 2. Total profit for the firm is Rs. 108.72, so the firm will enjoy economic profits. 3. For the second table with a lower price of Rs. 35, total profit is negative Rs. 36.4. So the firm must shutdown its operations.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    7 views1 page

    Cs 28

    Uploaded by

    Ammar Akhter Uz Zaman
    1. The table shows production quantities (Q), average variable costs (AVC), average costs (AC), marginal costs (MC), price (P), marginal revenue (MR), total revenue (TR), total costs (TC) and profits for a firm. 2. Total profit for the firm is Rs. 108.72, so the firm will enjoy economic profits. 3. For the second table with a lower price of Rs. 35, total profit is negative Rs. 36.4. So the firm must shutdown its operations.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    Q4

    Q AVC AC MC P MR TR TC Total Profit Marginal Profit


    9 41.10 52.21 30.70 288.00 50.00 2592 469.89 2122.11 19.30 Cost Curves
    10 40.00 50.00 30.10 288.00 50.00 2880 500 2380 19.90 60.00
    11 39.10 48.19 30.10 288.00 50.00 3168 530.09 2637.91 19.90
    12 38.40 46.73 30.70 288.00 50.00 3456 560.76 2895.24 19.30
    13 37.90 45.59 31.90 288.00 50.00 3744 592.67 3151.33 18.10
    14 37.60 44.74 33.70 288.00 50.00 4032 626.36 3405.64 16.30 50.00
    15 37.50 44.17 36.10 288.00 50.00 4320 662.55 3657.45 13.90
    16 37.60 43.85 39.10 288.00 50.00 4608 701.6 3906.4 10.90
    17 37.90 43.78 42.70 288.00 50.00 4896 744.26 4151.74 7.30
    40.00
    18 38.40 43.96 46.90 288.00 50.00 5184 791.28 4392.72 3.10
    19 39.10 44.36 51.70 288.00 50.00 5472 842.84 4629.16 -1.70
    20 40.00 45.00 57.10 288.00 50.00 5760 900 4860 -7.10

    Cost ($)
    30.00 AVC
    AC
    MC
    Ans Q4 (B)
    20.00
    Total profit = 108.72

    So the firm will Enjoy Economic Profits


    10.00

    0.00
    0 5 10 15 20 25
    Quantity

    Cost Curves
    60.00
    Q AVC AC MC P MR TR TC Total Profit Marginal Profit
    9 41.10 52.21 30.70 35.00 35.00 315 469.89 -154.89 4.30
    10 40.00 50.00 30.10 35.00 35.00 350 500 -150 4.90
    11 39.10 48.19 30.10 35.00 35.00 385 530.09 -145.09 4.90 50.00
    12 38.40 46.73 30.70 35.00 35.00 420 560.76 -140.76 4.30
    13 37.90 45.59 31.90 35.00 35.00 455 592.67 -137.67 3.10
    14 37.60 44.74 33.70 35.00 35.00 490 626.36 -136.36 1.30
    15 37.50 44.17 36.10 35.00 35.00 525 662.55 -137.55 -1.10 40.00
    16 37.60 43.85 39.10 35.00 35.00 560 701.6 -141.6 -4.10
    17 37.90 43.78 42.70 35.00 35.00 595 744.26 -149.26 -7.70
    18 38.40 43.96 46.90 35.00 35.00 630 791.28 -161.28 -11.90
    Cost ($)

    19 39.10 44.36 51.70 35.00 35.00 665 842.84 -177.84 -16.70 30.00 AVC
    20 40.00 45.00 57.10 35.00 35.00 700 900 -200 -22.10 AC
    MC

    20.00

    Ans Q4 (C)

    Total profit = 108.72


    10.00
    CM = TR - TVC = 490 - (37.6 x 14) = -36.4

    So the firm must Shutdown its operation


    0.00
    0 5 10 15 20 25
    Quantity

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