problemset4

# problemset4 - 1 1 1.00 9600 14600 1 0.50 10400 15400 1 0 b...

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4. a) Crepes in Universityville Price Total Quantity Demanded Total Cost Marginal Cost TR MR Profits 6.50 0 5000 -- 0 -- -5000 6.00 1000 6000 1 6000 5.5 0 5.50 2000 7000 1 11000 4.5 4000 5.00 3000 8000 1 15000 3.5 7000 4.50 4000 9000 1 18000 2.5 9000 4.00 4800 9800 1 19200 1 9400 3.50 5600 10600 1 19600 0 9000 3.00 6400 11400 1 19200 -1 7800 2.50 7200 12200 1 18000 -2 5800 2.00 8000 13000 1 16000 -3 3000 1.50 8800 13800
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Unformatted text preview: 1 13200-4-600 1.00 9600 14600 1 9600-5-5000 0.50 10400 15400 1 5200-6-10200 b) Total surplus is maximized when MC = Price = \$1. Larry’s profits at this price are -\$5000. c) Larry charges \$4.00 to maximize profit. His profits at this price are \$9,400. d)...
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## This note was uploaded on 02/17/2009 for the course ECON 101 taught by Professor Burkhauser during the Spring '08 term at Cornell.

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