Output Total Total Total Marginal Marginal (Q) Price Revenue Cost Profit Revenue Cost 20 $25.00 $500 $650 - $15 $5 40 $20.00 $800 $750 $5 - 60 $15.00 $900 $950 $15 80 $10.00 $800 $1,250 The table above shows revenue and cost information at four different Output (Q) levels for a Monopolist. If the Monopolist increases its Output from 40 to 60, Marginal Revenue (MR) is Select one: O a. greater than Price. O b. greater than MC. O c. equal to MC. O d. less than Price.

Output Total Total Total Marginal Marginal (Q) Price Revenue Cost Profit Revenue Cost 20 $25.00 $500 $650 - $15 $5 40 $20.00 $800 $750 $5 - 60 $15.00 $900 $950 $15 80 $10.00 $800 $1,250 The table above shows revenue and cost information at four different Output (Q) levels for a Monopolist. If the Monopolist increases its Output from 40 to 60, Marginal Revenue (MR) is Select one: O a. greater than Price. O b. greater than MC. O c. equal to MC. O d. less than Price.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter5: Investment Decisions: Look Ahead And Reason Back

Section: Chapter Questions

Problem 5.6IP

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A computer company produces affordable, easy-to-use home computer systems and has fixed costs of 250. The marginal cost of producing computers is 700 for the first computer, 250 for the second, 300 for the third, 350 for the fourth, 430 for the fifth, 450 for the sixth, and 500 for the seventh. Create a table that shows the companys output, total cost, marginal cost, average cost, variable cost, and average variable cost. At what price is the zero-profit point? At what price is the shutdown point? If the company sells the computers for 500, is it making a profit or a loss? How big is the profit or loss? Sketch a graph with AC, MC, and AVG curves to illustrate your answer and show the profit or loss. If the firm sells the computers for 300, is it making a profit or a loss? How big is the profit or loss? Sketch a graph with AC, MC, and AVG curves to illustrate your answer and show the profit or loss.
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