C onsider the attached table, which describes the Kaener Firm, a profit-maximizi
ID: 1225862 • Letter: C
Question
Consider the attached table, which describes the Kaener Firm, a profit-maximizing price taker. Use the information provided to fill in the requested blanks (you will not be asked to provide the values for all of them).
1.Enter the value for cell L.
2.Enter the value for cell Q.
3.Enter the value for cell R. Include a negative sign before any loss and no sign before (positive) profits.
4.Calculate the firm's total revenue when it maximizes profits.
5.Calculate the firm's maximum profits (or losses - if a loss, be sure to put a negative sign in front of your answer) associated with the profit-maximizing quantity.
6.Calculate the firm's total fixed costs when 6 units are produced
Enter only numbers, a decimal point, and/or a negative sign in your answer. Round your final answer to two decimal places as needed.
Q TC MC TR MR Profits 0 $30 - - - - H - - - - R 1 A $30 I M $0 2 B $40 $120 $60 S 3 $150 E J N T 4 C F K O $30 5 $280 G $300 P U 6 D $80 L Q VExplanation / Answer
The Total revenue of 2 quantity is 120 so Price per unit is 60
1) L is TR of 6 units i.e. 60*6 = $360
2) Q is the MR as price is constant so MR=P So Q=$60
3) R is profits at 0 quantity. So TR = 0*60 = 0
Profits = TR-TC = 0-30 = -$30
4) Firms profit is maximum when MC=MR it happen at quantity 4 and at quantity 4 TR = 4*60 = $240
Q TC MC TR MR Profits 0 $30 - - - - 0 - - - - -$30 1 $60 $30 $60 $60 $0 2 $100 $40 $120 $60 $20 3 $150 $50 $180 $60 $30 4 $210 $60 $240 $60 $30 5 $280 $70 $300 $60 $20 6 $360 $80 $360 $60 $0Related Questions
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