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Output 1 2 3 4 5 6 7 Price Total Revenue MR ----- Total Cost 25 35 43 51 59 72 91 Average Total Cost Marginal Cost ----- Assume the above table, when...

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Output Price Total Revenue MR Total Cost Average Total Cost Marginal Cost 1 ----- 25 ----- 2 35 3 43 4 51 5 59 6 72 7 91 Assume the above table, when completed, shows the revenue (demand) and cost situation facing an individual firm. Further assume this firm has a demand equation that can be expressed as Q = 18 - P. Based on that, answer the following. A. In the table above, fill in the missing values for Price, Total Revenue, Marginal Revenue (MR), Average Total Cost, and Marginal Cost. B. What is the firm’s profit maximizing output? Assume the firm will produce a whole number of units, i.e. will produce 1,2,3,,, units and not 3.6, 4.9,,,,or some other output that is not a whole number. Explain how you reached your answer . C. What price does this firm charge in order to sell its profit-maximizing output? Explain how you reached your answer . D. If this firm operates at its profit maximizing position, how much is its profit (or loss)? Show your work . E. The type of market structure in which this firm operates and whether the table indicates a short run or long run position cannot be absolutely determined, but some structure / time frame combinations can be ruled out. What are the combinations that can be excluded? Why can they be ruled out? Explain your answers .
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Table(2).doc

Output Price Total
Revenue MR Total
Cost Average
Total Cost Marginal
Cost 1
2
3
4
5
6
7 17
16
15
14
13
12
11 17
32
45
56
65
72
77 ----15
13
11
9
7
5 25
35
43
51
59
72
91 25
17.5
14.3333333
12.75...

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