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Quiz 3 #5

# Quiz 3 #5 - 20 40000-35000 4000 70000 7000 0-17000 6000...

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Quantity (1) Total Fixed Cost (2) Total variable cost (3) Total cost (4) Price (5) Total Revenue (6) Profit (7) 2000 20000 5000 25000 20 40000 15000 4000 20000 7000 27000 15 60000 33000 6000 20000 18000 38000 10 60000 22000 8000 20000 33000 53000 5 40000 -13000 10000 20000 50000 70000 1 10000 -60000

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Total cost = total fixed cost + total variable cost ( )= ( )+ ( ) column 4 collumn 2 column 3 Total Revenue = Price × Quantity ( )= ( )× ( ) column 6 Column 5 Column 1 Profit = total revenue – total cost ( )= ( )- ( ) Column 7 Column 6 Column 4 Optimum output = The output for which profit is maximum The maximum profit is \$33,000 for the output 4,000 units. Suppose the fixed costs increases to \$70,000, then Quantity (1) Total Fixed Cost (2) Total variable cost (3) Total cost (4) Price (5) Total Revenue (6) Profit (7) 2000 70000 5000 75000
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Unformatted text preview: 20 40000-35000 4000 70000 7000 77000 15 60000-17000 6000 70000 18000 88000 10 60000-28000 8000 70000 33000 103000 5 40000-63000 10000 70000 50000 120000 1 10000-110000 Total cost = total fixed cost + total variable cost → ( )= ( )+ ( ) column 4 collumn 2 column 3 Total Revenue = Price × Quantity → ( )= ( )× ( ) column 6 Column 5 Column 1 Profit = total revenue – total cost → ( )= ( )-( ) Column 7 Column 6 Column 4 Optimum output = The output for which profit is maximum The maximum profit is -\$17,000 (minimum loss) for the output 4,000 units. In both cases , the optimum output is 4,000 units. In the first case there is net profit of \$33,000 In the second case, there is net loss of \$17,000...
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