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    Caculate Production Level

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    A software producer has fixed costs of $20,000 per month and her Total Variable Costs (TVC) as a function of output Q are given below:

    Q TVC Price
    2,000 $5,000 $20
    4,000 7,000 15
    6,000 18,000 10
    8,000 33,000 5
    10,000 50,000 1

    If software can only be produced in the quantities above,

    a) What should be the production level if the producer operates in a monopolistic competitive market where the price of software at each possible quantity is also listed above?

    b) What should be the production level if fixed costs rose to $70,000 per month?

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    https://brainmass.com/economics/production/caculate-production-level-363944

    Solution Preview

    See the attached file. Hope this will help. Thanks

    A software producer has fixed costs of $20,000 per month and her Total Variable Costs (TVC) as a function of output Q are given below: 
    Q TVC Price MC MR
    2000 5000 20 2.50 20.00
    4000 7000 15 1.00 10.00
    6000 18000 10 3.00 0.00
    8000 33000 5 ...

    Solution Summary

    This post shows how to calculate the production level in 247 words with calculations attached in Excel.

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