econ302-q4b-summer09-answer%20key

econ302-q4b-summer09-answer%20key - Econ302 Quiz 4 June 4,...

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Unformatted text preview: Econ302 Quiz 4 June 4, 2009 Form B Name: 1. In order to maximize profits, a firm should produce at the output level for which a. average cost is minimized. b. marginal revenue equals marginal cost. c. marginal cost is minimized. d. price minus average cost is as large as possible. Table 1 Q P TR MR TC MC $30 $0 --- $15 --- 1 $30 $30 $30 $25 $10 2 $30 $60 $30 $40 $15 3 $30 $90 $30 $60 $20 4 $30 $120 $30 $85 $25 5 $30 $150 $30 $115 $30 6 $30 $180 $30 $150 $35 2. Refer to Table 1. That the firm is perfectly competitive is evident from its a. increasing marginal cost. b. increasing total cost. c. zero economic profits. d. constant marginal revenue. e. absence of marginal values at Q=0. 3. Suppose a farmer is a price taker (MR = P = 6) in soybeans with cost functions given by TC = .1q 2 + 2q + 30 MC = .2q + 2 The level of profit is a. 10 b. 60 c. d. 150 4.Consider the following statements when answering this question I. The marginal cost curve intersects the average total cost and average variable cost curves at...
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econ302-q4b-summer09-answer%20key - Econ302 Quiz 4 June 4,...

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