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Homework 05

Homework 05

Q Question 1 21 / 21 pts Suppose that a monopolistically competitive firm must build a production facility in order to produce a product. The fixed cost of this facility is FC = $24. Also, the firm has constant marginal cost, MC = $3. Demand for the product that the firm produces is given by P = 27-3Q. Calculate the missing values in the following table below. Missing values are denoted by a number inside a bracket [X]. Some numbers have been filled in for you. Place your answers in the corresponding numbered fields below the table. Hint: All answers that you fill in will be integers (no decimals). Be sure to just type the numbers and do not type in dollar signs. If you enter negative numbers, be sure to include a minus sign (-) to the left of the number. Another Hint: It may be best if you download the table first Download download the table firstand fill it in by hand and then type in your answers. Question 2 2 / 2 pts Enter just a number to answer this problem. How many units of output will the firm produce if maximizes its profit? Question 3 2 / 2 pts Enter just a number to answer this problem. What price should this firm charge if it wants to maximize its profit? Question 4 2 / 2 pts Monopolistic competition differs from perfect competition primarily because in monopolistic competition,

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1.Answer 1: 24 Answer 2: 21 Answer 3: 18 Answer 4: 15 Answer 5: 12 Answer 6: 9 Answer 7: 6 Answer 8: 3 Answer 9: 0 Answer 10: 27 Answer 11: 30 Answer 12: 33 Answer 13: 36 Answer 14: 39 Answer 15: 42 Answer 16: 45 Answer 17: 48 Answer 18: 51 Answer 19: 27 Answer 20: 15 Answer 21: 11 Answer 22: 9 Answer 23: 7 Answer 24: 6 Answer 25: 24 Answer 26: 42 Answer 27: 54 Answer 28: 60 Answer 29: 60 Answer 30: 54 Answer 31: 42 Answer 32: 24 Answer 33: 0 Answer 34: -3 Answer 35: 12 Answer 36: 21 Answer 37: 24