What is the firm current profit

Assignment Help Business Economics

Reference no: EM131101357

a. The Whampoa Gourmet Place houses a number of restaurants of various styles. Some restaurant owners close their shops during off-peak hours (2:00 pm–6:00 pm) but others keep their shops open. Explain this phenomenon.

b. At its current level of production a firm in a competitive market receives $12.50 for each unit it produces and faces an average total cost of $10. At the market price of $12.50 per unit, the firm’s marginal cost curve crosses the marginal revenue curve at an output level of 1,000 units.

i Is the firm maximizing profit? Briefly explain.

ii What is the firm’s current profit? Show your calculation steps.

iii Will new firms enter this market and if so, why?

Reference no: EM131101357

Questions Cloud

Use monetary policies to stabilize their economy : John Maynard Keynes who is considered to be the father of Macroeconomics by many once said "In the long-run we are all dead” to emphasize why decision-makers should not worry about long-run effects of policies. As we have also learned in this module ..

Criticism of the enactment of victimless crimes : Crimes Against Public Order. In some legislative contexts, public interests take precedence over individual rights and freedoms, and the crimes appear to be "victimless." Give several examples of crimes in this category and use the examples to illust..

When pharmaceutical firm develops new drug : In most of the developed countries, when a pharmaceutical firm develops a new drug, the patent laws give the firm a monopoly on the sale of the drug for a period of time (e.g. 10 to 15 years). Though a monopoly is generally inefficient, why does the ..

Pay less income tax under the same circumstance : Why might one person work more, earn more, and pay more income tax when his or her tax rate is cut, while another person will work less, earn less, and pay less income tax under the same circumstance?

What is the firm current profit : At its current level of production a firm in a competitive market receives $12.50 for each unit it produces and faces an average total cost of $10. At the market price of $12.50 per unit, the firm’s marginal cost curve crosses the marginal revenue cu..

Expenditures occupies largest portion of the fiscal budget : Which of the following expenditures occupies the largest portion of the fiscal budget for state and local governments? Which of the following is the largest source of tax revenue in the U.S.? A new tax policy has been passed in the country of Caldeco..

Exactly equal the stream of installments : Assume I won 100 million dollars in a lottery that pays installments of 20 million dollars a year for five years or a lump sum of less than 100 million dollars. If I take the installments, my first installment would come the day I claimed my winnings..

Import or export any goods or services : Bahrainia is a country that has closed borders and does not import or export any goods or services; hence, they do not worry about trade with other countries. Total spending for the federal government of Bahrainia for the last fiscal year was 24.2 bi..

Projected net benefits from gains in materials : A division of a large corporation is considering the purchase of a new tunneling X-ray microscope for $370,125. The projected net benefits from gains in materials engineering is projected to be $125,000 in today’s real dollars for the first year, inc..

User Account

All Pages