ECON 102 Homework 4 Answer (Penn State University)

ECON 102 Homework 4 Answer (Penn State University) Question 1 Examine the table above, which gives information about the costs of a perfectly competitive firm. You are hired to determine the profit-maximizing quantity for the firm at different prices. For each price listed, you must find the output level, total revenue, total cost, and profit. Question 2 Examine the table above, which gives information about the costs of a perfectly competitive firm. You are hired to determine the profit-maximizing quantity for the firm at different prices. For each price listed, you must find the output level, total revenue, total cost, and profit. Question 3 Examine the table above, which gives information about the costs of a perfectly competitive firm. You are hired to determine the profit-maximizing quantity for the firm at different prices. For each price listed, you must find the output level, total revenue, total cost, and profit. Question 4 Examine the table above, which gives information about the costs of a perfectly competitive firm. You are hired to determine the profit-maximizing quantity for the firm at different prices. For each price listed, you must find the output level, total revenue, total cost, and profit. Question 5 Examine the table above, which gives information about the costs of a perfectly competitive firm. You are hired to determine the profit-maximizing quantity for the firm at different prices. For each price listed, you must find the output level, total revenue, total cost, and profit. Question 6 In the short run, as output increases, Question 7 Marginal cost is ________ average variable cost when ________. Question 8 The formula for AVC is Question 9 If the marginal cost curve is below the average variable cost curve, then Question 10 Because marginal cost is always ________ in the short run, total variable cost always ________ when output increases. Question 11 The marginal cost curve intersects the ________ at its minimum. Question 12 In the short run where total variable cost is ________ at a(n) ________ rate, marginal cost is positive and decreasing. Question 13 In the short run, Question 14 In the short run, firms earning a profit will want to ________ their profits while firms suffering losses will want to ________ their losses. Question 15 You are hired as an economic consultant to The Pampered Pet Shop. The Pampered Pet Shop operates in a perfectly competitive industry. This firm is currently producing at a point where market price equals its marginal cost. The market price is less than its average variable cost. You should advise the firm to Question 16 A firm suffering economic losses decides whether or not to produce in the short run on the basis of whether Question 17 A firm that is earning positive profits in the short run has an incentive to ________ its scale of operation in the long run. Question 18 You are hired as an economic consultant to The Pampered Pet Shop. The Pampered Pet Shop operates in a perfectly competitive industry. This firm is currently producing at a point where market price equals its marginal cost. The Shopʹs total revenue exceeds its total variable cost, but is less than its total cost. You should advise the firm to Question 35 Suppose a monopolist faces the following demand curve: P = 420 – 4Q Marginal cost of production is constant and equal to $36, and there are no fixed costs. What is the monopolist’s profit-maximizing level of output? What price will the profit-maximizing monopolist charge? How much profit will the monopolist make if she maximizes her profit? What would be the value of consumer surplus in this monopoly market? How much consumer surplus would there be if this market was perfectly competitive? What is the value of the deadweight loss when the market is a monopoly?