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E202Solutions4.4 - below earn if the price of pizza is...

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7. What is the profit-maximizing level of output and how much daily profit will the producer below earn if the price of pizza is $2.50/slice? Answer : This firm will sell 570 slices per day, the quantity for which P = MC. Its profit will be (P-ATC) x Q = ($2.50/slice - $1.40/slice) x (570 slices/day) = $627/day. 8. What is the profit-maximizing level of output and how much daily profit will the producer
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Unformatted text preview: below earn if the price of pizza is $0.80/slice? Answer : This firm will sell 360 slices per day, the quantity for which P = MC. Its profit will be (P-ATC) x Q = ($0.80/slice -$1.03/slice) x (360 slices/day) = -$82.80/day....
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