Calculate marginal revenue and marginal cost

Assignment Help Business Economics

Reference no: EM131097417

Suppose Latasha runs a small business that manufactures frying pans. Assume that the market for frying pans is a price-taker market, and the market price is $10 per frying pan.

The following graph shows Latasha's total cost curve.

Use the blue points (circle symbol) to plot total revenue, and the green points (triangle symbol) to plot profit for the first seven frying pans that Latasha produces, including zero frying pans.

(GRAPH)

Calculate Latasha's marginal revenue and marginal cost for the first seven frying pans she produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost.

(GRAPH)

Latasha's profit is maximized when she producesfrying pans. When she does this, the marginal cost of the previous frying pan she produces is, which is than the price Latasha receives for each frying pan she sells. The marginal cost of producing an additional frying pan (that is, one more frying pan than would maximize her profit) is, which is than the price Latasha receives for each frying pan she sells. Therefore, Latasha's profit-maximizing quantity corresponds to the intersection of the curves. Because Latasha is a price taker, this last condition can also be written as.

Reference no: EM131097417

Questions Cloud

Find the delay and the phase difference : find the delay and the phase difference

Create a class rational which represents a numerical value : Create a class Rational which represents a numerical value by two double values-NUMERATOR & DENOMINATOR . Include the following Public member Functions:

Why are there so many differing technologies available : This complicates the middleware landscape, making for a variety of technologies that can be appropriately used to accomplish an integration goal.

Perform a normalization process for the scenario : 1. Perform a normalization process for the scenario. Use dependency diagram in your explaination. 2. Develop an entity relationship diagram(ERD) based on task 1 and SDLC for develop the information.

Calculate marginal revenue and marginal cost : Suppose Latasha runs a small business that manufactures frying pans. Assume that the market for frying pans is a price-taker market, and the market price is $10 per frying pan. Calculate Latasha's marginal revenue and marginal cost for the first seve..

Create two classes dm and db which store the value of : Create two classes DM and DB which store the value of distances. DM stores distances in meters and centimeters and DB in feet and inches. Write a program that can read values for the class objects and add one object of DM with another object of DB.

Safety inventory of mozzarella : How much safety inventory of mozzarella cheese will the pizza restaurant need to hold under each of these two carrier options? Show how you calculated this SI value.

Define consumer surplus total welfare and deadweight loss : What are the two characteristics that must be met for a good to be considered a "public good?" Define the Consumer surplus, Producer surplus, Total welfare and Deadweight loss.

Discrimination in the workplace : Women have always been target for discrimination in the workplace. This applies for recruitment as well, as there are many jobs that are perceived to be meant for men rather than women.

User Account

All Pages