At Westonci.ca, we connect you with experts who provide detailed answers to your most pressing questions. Start exploring now! Explore our Q&A platform to find in-depth answers from a wide range of experts in different fields. Experience the ease of finding precise answers to your questions from a knowledgeable community of experts.
Sagot :
Sure, let's go through each part of the question.
### Part a: Fill in the Marginal Revenue (MR) and Average Revenue (AR) columns
To get started, let's recall that in a perfectly competitive market, the market price is both the Marginal Revenue (MR) and the Average Revenue (AR). Since the market price per apple pie is \[tex]$4.00, both MR and AR should be \$[/tex]4.00 for all quantities.
So, we simply fill in the MR and AR columns with the market price:
[tex]\[ \begin{array}{|c|c|c|c|c|} \hline \text{Quantity (apple pies)} & \text{TC (dollars)} & \text{MC (dollars)} & \text{MR (dollars)} & \text{AR (dollars)} \\ \hline 5 & 55.00 & 1.00 & 4.00 & 4.00 \\ \hline 10 & 57.50 & 0.50 & 4.00 & 4.00 \\ \hline 15 & 62.50 & 1.00 & 4.00 & 4.00 \\ \hline 20 & 72.50 & 2.00 & 4.00 & 4.00 \\ \hline 25 & 92.50 & 4.00 & 4.00 & 4.00 \\ \hline 30 & 122.50 & 6.00 & 4.00 & 4.00 \\ \hline \end{array} \][/tex]
### Part b: Determine the number of apple pies to produce at a market price of \$4.00 per apple pie
In order to maximize profit, the firm should produce at the quantity where Marginal Cost (MC) equals Marginal Revenue (MR). Given MR = \[tex]$4.00, we look for the quantity where MC = \$[/tex]4.00:
From the table, we observe:
\begin{itemize}
\item At quantity 25, \( MC = \$4.00 \)
\end{itemize}
Thus, the firm should produce 25 apple pies.
### Part c: Determine the number of apple pies to produce at a market price of \$6.00 per apple pie
Similarly, if the market price rises to \[tex]$6.00 per apple pie, we need to find the quantity where MC equals this new price, which is \$[/tex]6.00:
From the table, we observe:
\begin{itemize}
\item At quantity 30, \( MC = \$6.00 \)
\end{itemize}
Thus, the firm should produce 30 apple pies.
### Summary:
a. The complete table with MR and AR filled in:
[tex]\[ \begin{array}{|c|c|c|c|c|} \hline \text{Quantity (apple pies)} & \text{TC (dollars)} & \text{MC (dollars)} & \text{MR (dollars)} & \text{AR (dollars)} \\ \hline 5 & 55.00 & 1.00 & 4.00 & 4.00 \\ \hline 10 & 57.50 & 0.50 & 4.00 & 4.00 \\ \hline 15 & 62.50 & 1.00 & 4.00 & 4.00 \\ \hline 20 & 72.50 & 2.00 & 4.00 & 4.00 \\ \hline 25 & 92.50 & 4.00 & 4.00 & 4.00 \\ \hline 30 & 122.50 & 6.00 & 4.00 & 4.00 \\ \hline \end{array} \][/tex]
b. The firm should produce 25 apple pies at a market price of \$4.00 per apple pie.
c. If the market price rises to \$6.00 per apple pie, the firm should produce 30 apple pies.
### Part a: Fill in the Marginal Revenue (MR) and Average Revenue (AR) columns
To get started, let's recall that in a perfectly competitive market, the market price is both the Marginal Revenue (MR) and the Average Revenue (AR). Since the market price per apple pie is \[tex]$4.00, both MR and AR should be \$[/tex]4.00 for all quantities.
So, we simply fill in the MR and AR columns with the market price:
[tex]\[ \begin{array}{|c|c|c|c|c|} \hline \text{Quantity (apple pies)} & \text{TC (dollars)} & \text{MC (dollars)} & \text{MR (dollars)} & \text{AR (dollars)} \\ \hline 5 & 55.00 & 1.00 & 4.00 & 4.00 \\ \hline 10 & 57.50 & 0.50 & 4.00 & 4.00 \\ \hline 15 & 62.50 & 1.00 & 4.00 & 4.00 \\ \hline 20 & 72.50 & 2.00 & 4.00 & 4.00 \\ \hline 25 & 92.50 & 4.00 & 4.00 & 4.00 \\ \hline 30 & 122.50 & 6.00 & 4.00 & 4.00 \\ \hline \end{array} \][/tex]
### Part b: Determine the number of apple pies to produce at a market price of \$4.00 per apple pie
In order to maximize profit, the firm should produce at the quantity where Marginal Cost (MC) equals Marginal Revenue (MR). Given MR = \[tex]$4.00, we look for the quantity where MC = \$[/tex]4.00:
From the table, we observe:
\begin{itemize}
\item At quantity 25, \( MC = \$4.00 \)
\end{itemize}
Thus, the firm should produce 25 apple pies.
### Part c: Determine the number of apple pies to produce at a market price of \$6.00 per apple pie
Similarly, if the market price rises to \[tex]$6.00 per apple pie, we need to find the quantity where MC equals this new price, which is \$[/tex]6.00:
From the table, we observe:
\begin{itemize}
\item At quantity 30, \( MC = \$6.00 \)
\end{itemize}
Thus, the firm should produce 30 apple pies.
### Summary:
a. The complete table with MR and AR filled in:
[tex]\[ \begin{array}{|c|c|c|c|c|} \hline \text{Quantity (apple pies)} & \text{TC (dollars)} & \text{MC (dollars)} & \text{MR (dollars)} & \text{AR (dollars)} \\ \hline 5 & 55.00 & 1.00 & 4.00 & 4.00 \\ \hline 10 & 57.50 & 0.50 & 4.00 & 4.00 \\ \hline 15 & 62.50 & 1.00 & 4.00 & 4.00 \\ \hline 20 & 72.50 & 2.00 & 4.00 & 4.00 \\ \hline 25 & 92.50 & 4.00 & 4.00 & 4.00 \\ \hline 30 & 122.50 & 6.00 & 4.00 & 4.00 \\ \hline \end{array} \][/tex]
b. The firm should produce 25 apple pies at a market price of \$4.00 per apple pie.
c. If the market price rises to \$6.00 per apple pie, the firm should produce 30 apple pies.
Thanks for using our service. We're always here to provide accurate and up-to-date answers to all your queries. Thank you for your visit. We're dedicated to helping you find the information you need, whenever you need it. Thank you for using Westonci.ca. Come back for more in-depth answers to all your queries.
