Topic 4 Assignment On the following graph, use the green points (triangle symbol) to graph the marginal-revenue curve, then use the orange points (square symbol) to plot the marginal-cost curve. (Note: Be sure to plot from left to right and to plot between integers. For example, if the marginal cost of increasing production from 1 unit to 2 units is $5, then you would plot a point at (1.5, 5).) Revenue and Costs 10 9 8 7 6 5 4 3 2 1 0 0 1 2 3 4 5 6 7 Quantity Marginal Revenue Marginal Cost The marginal-revenue curve and the marginal-cost curve cross at a quantity between 5 and 6 units. This firm is in a competitive industry, because marginal revenue is increasing as quantity increases. The industry is in a long-run equilibrium.
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The marginal-revenue curve and the marginal-cost curve cross at a quantity between 5 and 6 units. This means that the quantity at which the two curves intersect is between 5 and 6 units. Show more…
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The following table gives the demand curve facing a monopolist: Use the numbers in the table to answer the questions below: Please enter your answer as number (ie. $20 or 20 not "Twenty Dollars") Quantity 1 2 3 4 5 6 Price $10 $9 $8 $7 $6 $5 What is the Total Revenue from selling 3 units? What is the Marginal Revenue from selling the 3rd unit?
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Consider total cost and total revenue given in the following table: $$\mathrm{Quantity} \quad 0\quad 1\quad 2\quad 3\quad 4\quad 5\quad 6\quad 7 $$ $$\mathrm{Total cost} \quad$8\quad 9\quad 10\quad 11\quad 13\quad 19\quad 27\quad 37 $$ $$\mathrm{Total revenue}\quad $0\quad 8\quad 16\quad 24\quad 32\quad 40\quad 48\quad 56 $$ a. Calculate profit for each quantity. How much should the firm produce to maximize profit? b. Calculate marginal revenue and marginal cost for each quantity. Graph them. ($Hint$: Put the points between whole numbers. For example, the marginal cost between 2 and 3 should be graphed at 2 $1\over2$.) At what quantity do these curves cross? How does this relate to your answer to part (a)? c. Can you tell whether this firm is in a competitive industry? If so, can you tell whether the industry is in a long-run equilibrium?
Complete the table directly below by calculating marginal product and average product. Plot the total, marginal, and average products and explain in detail the relationship between each pair of curves. Explain why marginal product first rises, then declines, and ultimately becomes negative. What bearing does the law of diminishing returns have on short-run costs? Be specific. "When marginal product is rising, marginal cost is falling. And when marginal product is diminishing, marginal cost is rising." Illustrate and explain graphically. $$\begin{aligned} &\\ &\begin{array}{|c|c|c|c|} \hline \begin{array}{c} \text { Inputs of } \\ \text { Labor } \end{array} & \begin{array}{c} \text { Total } \\ \text { Product } \end{array} & \begin{array}{c} \text { Marginal } \\ \text { Product } \end{array} & \begin{array}{c} \text { Average } \\ \text { Product } \end{array} \\ \hline 0 & 0 & & \\ 1 & 15 & & \\ 2 & 34 & & \\ 3 & 51 & & \\ 4 & 65 & & \\ 5 & 74 & & \\ 6 & 80 & & \\ 7 & 83 & & \\ 8 & 82 & & \\ \hline \end{array} \end{aligned}$$
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