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The Costs of Production

Full Description: for the data below, I have to solve the problems, create problems similiar, and write a paper based on the data and use this as a study guide. I calculated these problems myself but wanted to get them done as to double check them since a lot of different parts of a large assignment is based off of the first steps.

Assume that the following cost data are for a purely competitive producer:

Total Product AFC AVC ATC MC
0 - - - -
1 $60 $45 $105 45
2 30 42.50 72.50 40
3 20 40 60 35
4 15 37.5 52.50 30
5 12 37 49 35
6 10 38.57 47.50 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 46.50 52.5 75

Question 1: At product price $56, will this firm produce in the short run? Why or Why not? If it is going to produce, what will be the profit-maximizing or loss-minimizing output? Explain. What economic profits or losses will the firm realize?
Question 2: repeat question 1 changing the product price to $41 and $32.

2nd part:
Question 1: in the table below, complete the short run supply schedule for the firm (column 2) and indicate the profits/losses (column 3) at each price/output:

(1) (2) (3) (4)
Price Quanity Profits(+) Total Quantity
(Market) Supplied or losses (-) Demanded
$26 17,000
$32 15,000
$38 13,500
$41 12,000
$46 10,500
$56 9,500
$66 8,000

Solution Preview

Full Description: for the data below, I have to solve the problems, create problems similiar, and write a paper based on the data and use this as a study guide. I calculated these problems myself but wanted to get them done as to double check them since a lot of different parts of a large assignment is based off of the first steps.

Assume that the following cost data are for a purely competitive producer:

Total Product AFC AVC ATC MC
0 - - - -
1 $60 $45 $105 45
2 30 42.50 72.50 40
3 20 40 60 35
4 15 37.5 52.50 30
5 12 ...

Solution Summary

The Costs of Production are depicted.

$2.19