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Labor Output Total Cost (TC) Marginal Cost (MC) Average Cost Total Revenue P=125 0 0 $ 3,000.00 $ - 1 10 $ 4,250.00 $ 125.00 $ 425.00 $ 1,250.00 2 25...

This question was answered on Jan 16, 2013. View the Answer
Labor Output Total Cost
(TC) Marginal
Cost (MC) Average
Cost Total Revenue
P=125
0 0 $ 3,000.00 $ -
1 10 $ 4,250.00 $ 125.00 $ 425.00 $ 1,250.00
2 25 $ 5,500.00 $ 83.33 $ 220.00 $ 3,125.00
3 45 $ 6,750.00 $ 62.50 $ 150.00 $ 5,625.00
4 70 $ 8,000.00 $ 50.00 $ 114.29 $ 8,750.00
5 95 $ 9,250.00 $ 50.00 $ 97.37 $11,875.00
6 115 $10,500.00 $ 62.50 $ 91.30 $14,375.00
7 133 $11,750.00 $ 69.44 $ 88.35 $16,625.00
8 149 $13,000.00 $ 78.13 $ 87.25 $18,625.00
9 164 $14,250.00 $ 83.33 $ 86.89 $20,500.00
10 174 $15,500.00 $ 125.00 $ 89.08 $21,750.00
11 182 $16,750.00 $ 156.25 $ 92.03 $22,750.00
12 188 $18,000.00 $ 208.33 $ 95.74 $23,500.00
13 192 $19,250.00 $ 312.50 $ 100.26 $24,000.00

Pearl owns a company that produces Super Toys. The table above shows that Pearls’ Fixed Cost is $3000.00. Pearl pays $1,250 for each unit of labor. Marginal and Average Costs of production are show n in the table. If Pearl conducts business in a Perfectly Competitive Market where the price of each toy sold is $125.00:

1. What is Pearl’s Marginal Revenue for each additional unit of Super Toy sold?
2. What is the Profit Maximizing number of Toys that Pearl should produce?
3. What is the Total Profit at this Profit Maximizing number of toys?
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MEDGAR EVERS...

This question was asked on Jan 16, 2013 and answered on Jan 16, 2013.

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