Fill This Form To Receive Instant Help

Help in Homework
trustpilot ratings
google ratings


Homework answers / question archive / Quantity, price, total revenue, and total cost for a monopoly firm that produces cement are listed in the table below

Quantity, price, total revenue, and total cost for a monopoly firm that produces cement are listed in the table below

Economics

Quantity, price, total revenue, and total cost for a monopoly firm that produces cement are listed in the table below. 
Quantity, (Q) (tons) Price (P) Total Revenue (TR) Total Cost (TC) 1 $1,400 $1,400 $900 2 $1,315 $2,630 $980 3 $1,230 $3,690 $1,100 4 $1,145 $4,580 $1,270 5 $1,060 $5,300 $1,510 6 $975 $5,850 $1,810 7 $890 $6,230 102,190 
Determine the firm's profit-maximizing price. Write the exact answer. Do not round. 

pur-new-sol

Purchase A New Answer

Custom new solution created by our subject matter experts

GET A QUOTE

Answer Preview

Computation of Firm's Profit Maximizing price:

Quantity ( Q) Price Total Revenue Total Cost ( TC) Marginal Revenue ( MR) Marginal Cost ( MC) Profit /Loss
(tons) ( P) ( TR)
1 1400 1400 900 - - 500
2 1315 2630 980 1230 80 1650
3 1230 3690 1100 1060 120 2590
4 1145 4580 1270 890 170 3310
5 1060 5300 1510 720 240 3790
6 975 5850 1810 550 300 4040
7 890 6230 2190 380 380

4040

 

 

So the profit maximising price will be $890 because at this point MR = MC = $380