Math Problem Statement
The columns are labeled (1) Total product (output); (2) average fixed cost (AFC) in dollars; (3) average variable cost (AVC) in dollars; (4) average total cost (ATC) in dollars; (5) marginal cost (MC) in dollars; (6) Price equals marginal revenue (MR) (7) in dollars; and total economic profit (positive) or loss (negative) in dollars. The data is as follows: 0, blank, blank, blank, blank, blank, blank, Negative 100. 1, 100.00, 90.00, 190.00, 90, 131, and negative 59. 2, 50.00, 85.00, 135.00, 80, 131, and negative 8. 3, 33.33, 80.00, 113.33, 70, 131, and positive 53. 4, 25.00, 75.00, 100.00, 60, 131, and positive 124.
5, 20.00, 74.00, 94.00, 70, 131, and positive 185. 6, 16.67, 75.00, 91.67, 80, 131, and positive 236. 7, 14.29, 77.14, 91.43, 90, 131, and positive 277. 8, 12.50, 81.25, 93.75, 110, 131, and positive 298. 9, 11.11, 86.67, 97.78, 130, 131, and positive 299. 10, 10.00, 93.00, 103.00, 150, 131, and positive 280.Select all that apply
Based on the information given in the table, which of the following statements are true?
Multiple select question.
The average fixed cost increases after the sixth unit of production.
The tenth unit should be produced as it adds more to revenue than to cost.
Every unit of output up to and including the ninth unit represents greater marginal revenue than marginal cost.
The ninth unit of output is the profit-maximizing level of output.Second last data row with the total product, 9 is highlighted.
Solution
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Math Problem Analysis
Mathematical Concepts
Cost Analysis
Profit Maximization
Marginal Analysis
Formulas
Average Fixed Cost (AFC) = Total Fixed Costs / Output
Marginal Cost (MC) = Change in Total Cost / Change in Output
Profit Maximization: Produce where MR = MC
Theorems
Profit is maximized when Marginal Revenue equals Marginal Cost (MR = MC)
Suitable Grade Level
Grades 11-12 (Economics, Business Mathematics)
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