aps4 - BeomSoo Kim Solution of Problem Set #4 11. a....

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
BeomSoo Kim 1/3 Solution of Problem Set #4 11. a. Filling in the missing columns: Quantity Price Total Revenue Marginal Revenue Average Revenue Total Cost Marginal Cost Average Cost Profit 0 -- $0 -- -- $0 -- $0 1 9.50 9.50 9.50 9.50 4.50 4.50 4.50 5.00 2 9.00 18.00 8.50 9.00 10.00 5.50 5.00 8.00 3 8.50 25.50 7.50 8.50 16.50 6.50 5.50 9.00 4 8.00 32.00 6.50 8.00 24.00 7.50 6.00 8.00 5 7.50 37.50 5.50 7.50 32.50 8.50 6.50 5.00 6 7.00 42.00 4.50 7.00 42.00 9.50 7.00 0 7 6.50 45.50 3.50 6.50 52.50 10.50 7.50 -7.00 8 6.00 48.00 2.50 6.00 64.00 11.50 8.00 -16.00 9 5.50 49.50 1.50 5.50 76.50 12.50 8.50 -27.00 10 5.00 50.00 0.50 5.00 90.00 13.50 9.00 -40.00 b. At what (integer) quantity is profit maximized? ____3____. How can the relationship between MR and MC also lead you to this answer? Solution: At 3 rd unit, MR>MC; from 4 th unit, MR<MC. The point MR=MC is not integer in this problem. As long as MR is higher than MC, the goods should be produced. So 3 is the profit maximization quantity. 12. Solution:
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 09/18/2010 for the course ECON 201 taught by Professor Beomsookim during the Fall '10 term at Korea University.

Page1 / 3

aps4 - BeomSoo Kim Solution of Problem Set #4 11. a....

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online