| Output | Variable Cost of Production |
|---|---|
| 0 | 0 |
| 1 | 25 |
| 2 | 42 |
| 3 | 54 |
| 4 | 64 |
| 5 | 75 |
| 6 | 93 |
| 7 | 112 |
| 8 | 140 |
| 9 | 180 |
| 10 | 230 |
The sunk cost of production in the short run is 15.
Let denote the profit of the firm when the price of the output is 20 and let denote the profit of the firm when the price of the output is 19. Which of the following is correct?
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| Output | Variable Cost of Production | 0 | 0 | 1 | 25 | 2 | 42 | 3 | 54 | 4 | 64 | 5 | 75 | 6 | 93 | 7 | 112 | 8 | 140 | 9 | 180 | 10 | 230 | The sunk cost of production in the short run is 15. Let π(20) denote the profit of the firm when the price of the output is 20 and let π(19) denote the profit of the firm when the price of the output is 19. Which of the following is correct? (A) π(20) = π(19) = 6 (B) π(20) < π(19) (C) π(20) > π(19) (D) π(20) = π(19) = 23
Also written as: | Output | Variable Cost of Production | 0 | 0 | 1 | 25 | 2 | 42 | 3 | 54 | 4 | 64 | 5 | 75 | 6 | 93 | 7 | 112 | 8 | 140 | 9 | 180 | 10 | 230 | The sunk cost of production in the short run is 15. Let pi(20) denote the profit of the firm when the price of the output is 20 and let pi(19) denote the profit of the firm when the price of the output is 19. Which of the following is correct?
Perfect competition has come up 115 times in 7 exams since 2006.
This question is on Profit maximisation and the competitive firm, part of Perfect competition in Microeconomics.
How a price-taking firm picks output where price equals marginal cost, and when it breaks even or shuts down.
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Question from the JNU SSS 2010 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.