Market Forms
The following questions address some of the price and output decisions faced by firms other than those found in perfect competition. Some numbers may be rounded.
Table 1
|
Output
|
Average Fixed cost
|
Average Variable Cost
|
Average Total Cost
|
Marginal Cost
|
Price
|
Total Revenue
|
Marginal Revenue
|
|
0
|
|
|
|
|
$ 345.00
|
|
|
|
1
|
$ 180.00
|
$ 135.00
|
$ 315.00
|
|
$ 300.00
|
|
|
|
2
|
$ 90.00
|
$ 127.50
|
$ 217.50
|
|
$ 249.00
|
|
|
|
3
|
$ 60.00
|
$ 120.00
|
$ 180.00
|
|
$ 213.00
|
|
|
|
4
|
$ 45.00
|
$ 112.50
|
$ 157.50
|
|
$ 189.00
|
|
|
|
5
|
$ 36.00
|
$ 111.00
|
$ 147.00
|
|
$ 165.00
|
|
|
|
6
|
$ 30.00
|
$ 112.50
|
$ 142.50
|
|
$ 144.00
|
|
|
|
7
|
$ 25.71
|
$ 115.70
|
$ 141.41
|
|
$ 126.00
|
|
|
|
8
|
$ 22.50
|
$ 121.90
|
$ 144.40
|
|
$ 111.00
|
|
|
|
9
|
$ 20.00
|
$ 130.00
|
$ 150.00
|
|
$ 99.00
|
|
|
|
10
|
$ 18.00
|
$ 139.50
|
$ 157.50
|
|
$ 87.00
|
|
|
Questions:
- Complete Table 1. Summarize your calculations and use Microsoft Excel.
- Using Excel, draw one graph showing average fixed costs, average variable costs, average total costs, marginal revenue, and marginal costs.
- Using the data in the table and on your graph, what is the profit maximizing, or loss minimizing level of output? Explain and justify your answers.