Explain profit maximizing or loss minimizing level of output

Assignment Help Macroeconomics
Reference no: EM131311507

Assignment: Market Forms

For this assignment you will do a significant portion of work in MS Excel and import it into an MS Word document for submission. You will use the data below to address Price and Output decisions faced by firms that are not in pure competition. Some numbers may be rounded.

Table 1

Output

Average Fixed cost

Average Variable Cost

Average Total Cost

Marginal Cost

Price

Total Revenue

Marginal Revenue

0





$ 345.00



1

$ 180.00

$ 135.00

$ 315.00


$ 300.00



2

$ 90.00

$ 127.50

$ 217.50


$ 249.00



3

$ 60.00

$ 120.00

$ 180.00


$ 213.00



4

$ 45.00

$ 112.50

$ 157.50


$ 189.00



5

$ 36.00

$ 111.00

$ 147.00


$ 165.00



6

$ 30.00

$ 112.50

$ 142.50


$ 144.00



7

$ 25.71

$ 115.70

$ 141.41


$ 126.00



8

$ 22.50

$ 121.90

$ 144.40


$ 111.00



9

$ 20.00

$ 130.00

$ 150.00


$ 99.00



10

$ 18.00

$ 139.50

$ 157.50


$ 87.00



Address the following:

1. Complete Table-1. Summarize your calculations.
2. Prepare a graph showing:

o Average Fixed Costs
o Average Variable Costs
o Average Total Costs
o Marginal Revenue
o Marginal Costs

3. Using the data in the table and on your graph, explain the profit maximizing, or loss minimizing level of output.

4. Define a normal profit and an economic profit. Are normal profits being earned in this example? Are economic profits present for this firm in this example? Explain your answers.

5. Given the data in the table and the graph, what type of market structure could this be in the short run? Explain your answers.

6. If the data in Table-1 represents the long run, what type of firm must this data represent? Explain your answers.

Reference no: EM131311507

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