Consider a firm that has a fixed cost of $70. Complete the following table: Outp
ID: 1253020 • Letter: C
Question
Consider a firm that has a fixed cost of $70. Complete the following table:
Output
FC
VC
TC
MC
AFC
AVC
ATC
1
$20
2
28
3
40
4
56
5
80
A publisher initially prices both hardback books and paperback books at $30 per book. Each book costs $3 to produce. Complete the following table.
Price
Quantity
Total Revenue
Total Cost
Profit
Hardback
$30
150
Paperback
30
150
Total
300
b) The price elasticity of demand for hardback is 0.6 and the price elasticity of demand for paperback is 3. Suppose the publisher increases the price for hardback by 10% and decreases the price of paperback by 10%. Complete the following table.
Price
Quantity
Total Revenue
Total Cost
Profit
Hardback
Paperback
Total
Output
FC
VC
TC
MC
AFC
AVC
ATC
1
$20
2
28
3
40
4
56
5
80
Explanation / Answer
Output
FC
VC
TC
MC
AFC
AVC
ATC
1
70
20
90
-
70
20
90
2
70
28
98
8
35
14
49
3
70
40
110
12
23.33
13.33
36.66
4
70
56
126
16
17.5
14
31.5
5
70
80
150
24
14
16
30
Price
Quantity
TR
TC
Profit
Hardback
30
150
4500
450
4050
Paperback
30
150
4500
450
4050
Total
300
9000
900
8100
Price
Quantity
TR
TC
Profit
Hardback
33
141
4653
423
4230
Paperback
27
195
5265
585
4680
Total
336
9918
1008
8910
Output
FC
VC
TC
MC
AFC
AVC
ATC
1
70
20
90
-
70
20
90
2
70
28
98
8
35
14
49
3
70
40
110
12
23.33
13.33
36.66
4
70
56
126
16
17.5
14
31.5
5
70
80
150
24
14
16
30
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