Micro ch 11

Assuming that price equals MC the profit of producing 8 barrels of oil is: and the total cost is:

$160. $240

What are the fixed costs of production for this firm?

$30

The change in profit from producing the second barrel of oil is ____ and the MC from producing the seventh barrel of oil is ____

$60; $140

The MC of the fifth unit of output is

$70

At a price of $20, the firm earns a profit of:

$75

What is the profit of profiting 10 barrels of oil?

$80

The marginal revenue for the fifth unit of output is

$90

What is the optimal number of cans of pineapple for this firm to produce

120,000

What is the firms profit maximizing level of output

170

The profit maximizing output for this firm is:

6

Refer to the table that shows the revenue and costs schedules for a competitive firm what is the profit maximizing quantity

7

Restaurants in tourists areas will close during the off season if their:

AVC is less than TR

This industry is a

Constant cost industry

A firms total profit is equal to the MC of production multiplied by the quantity produced. T/F

False

A firm should exit an industry if

P-AC=0

A firm should exit the industry if which of the conditions apply:

P<AC

Which panel shows the typical shape of the AVC curve in a competitive market

Panel A - it looks like a U

How much profit is the firm making at the profit maximizing quantity

The firm is making a loss of $220

A firm pays a monthly lease of $10,000 and generates $8,000 of rev a month which is true

This firm will exit the industry in the LR

A competitive firm maximizes profits when price equals MC. T/F

True

A firm should exit an industry if price is less than AC . T/F

True

A firm will continue to produce additional output, as long as MR is > MC T/F

True

A firms SRSC is its MC curve T/F

True

A firms profit maximizing quantity DOES NOT depend on fixed costs T/F

True

A constant-cost industry is one in which:

an increase in overall industry output does not lead to an increase in overall industry costs