Frances sells pencils in the perfectly competitive pencil market. Her output per day and costs are seen in the table to the right. a. If the current equilibrium price in the pencil market is $1.80, what price will Frances charge? A. $1.80 OB. $5.00 OC. $2.00 D. $1.05 b. Find the correct quantities for the missing values in the table, as represented by (i, ii, iii, and iv; enter all values as dollars and cents). (1) Marginal revenue is $ (i) Total revenue is $. (ii) Marginal revenue is $ (iv) Total revenue is $ c. What quantity of pencils will maximize Frances' profit? pencils. Output per Total Cost day 0 1 $1.05 1.85 2.55 3.20 3.65 4.30 5.55 7.75 10.10 MC $0.80 0.70 0.65 0,45 0.65 1.25 2.20 2.35 Total Marginal Revenue Revenue $0.00 1.80 3.60 5.40 (W) 9.00 10.80 (iv) 14.40 $1.80 1.80 (1) 1.80 1.80 (ii) 1.80 1.80

Frances sells pencils in the perfectly competitive pencil market. Her output per day and costs are seen in the table to the right. a. If the current equilibrium price in the pencil market is $1.80, what price will Frances charge? A. $1.80 OB. $5.00 OC. $2.00 D. $1.05 b. Find the correct quantities for the missing values in the table, as represented by (i, ii, iii, and iv; enter all values as dollars and cents). (1) Marginal revenue is $ (i) Total revenue is $. (ii) Marginal revenue is $ (iv) Total revenue is $ c. What quantity of pencils will maximize Frances' profit? pencils. Output per Total Cost day 0 1 $1.05 1.85 2.55 3.20 3.65 4.30 5.55 7.75 10.10 MC $0.80 0.70 0.65 0,45 0.65 1.25 2.20 2.35 Total Marginal Revenue Revenue $0.00 1.80 3.60 5.40 (W) 9.00 10.80 (iv) 14.40 $1.80 1.80 (1) 1.80 1.80 (ii) 1.80 1.80

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter8: Perfect Competition

Section: Chapter Questions

Problem 1SCQ: Firms ill a perfectly competitive market are said to be price takers that is, once the market...

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