I just need 8, but I would also like to confirm that the anser to 7 is A Assume
ID: 1158125 • Letter: I
Question
I just need 8, but I would also like to confirm that the anser to 7 is A
Assume a certain firm is producing Q-1,000 units of output. At Q-1,000, the firm's marginal cost equals $5 and its average total cost equals $11. The firm sells its output for $12 per unit. At Q 999, the firm's profit amounts to a.$993 $997 $1,003 $1,007 Suppose a firm in a competitive market received $1,000 in total re venue and had a marginal revenue of $10 for the last unit produced and sold. What is the average revenue per unit, and how many units were sold? S5 and 50 $5 and 100 $10 and 50 $10 and 100 For a certain firm, the 100th unit of output that the firm produces has a marginal revenue of $10 and a marginal cost of $7. It follows that The production of the 100th unit of output increases the firm's profit by S3 The production of the 100th unit of output increases the firm's average total cost by $7 The firm's profit-maximizing level of output is less than 100 units The production of the 110th unit of output must increase the firmis profit by less than $3 Susan quit her job as a teacher, which paid her $36,000 per year, in order to start her own catering business. She spent $12,000 of her savings, which had been earning 10 percent interest per year, on equipment for her business. She also borrowed $12,000 from her bank at 10 percent interest, which she also spent on equipment. For the past several months she has spent $1,000 per month on ingredients and other variable costs. Also for the past several months she has taken in $3,500 in monthly revenue In the short run, Susan should shut down her business and in the long run she should exit the industry In the short run. Susan should continue to operate her business, but in the long run she should exit the industry In the short run, Susan should continue to operate her business, but in the long run she will probably face competition from newly entering firms In the short run, Susan should continue to operate her business, and she is also in long-run equilibriumExplanation / Answer
7) Solution: production of the 100th unit of output increases the firm's profit by $3.
Explanation: As we are given at the 100th unit of output a marginal cost of $7 and marginal revenue of $10 thus production of the 100th unit of output increases the firm's profit by $3
8) Solution: In the short run, Susan should continue to operate her business, but in the long run she will probably face competition from newly entering firms.
Explanation: Susan is running a successful business. Susan incurs $1000 per month expenditures and $1200 per year paid as interest. $3500 per month is revenue which is more than she's paying. Thus as she is doing a profitable business thus the long run new entrant may give her competition