Question

$24 $6 Show that AR = P by definition. 2. 3. The firm faces a fixed cost of $2 per week, and the following variable costs. Complete the table below. Profit MR. Quantity of output (Q) TR ($) MC (S) TC (S) vC (S) FC ($) ($) ($) 0 2 2 0 6 10 8 2 1 12 2 12 10 2 2 18 15 13 3 24 19 17 30 5 24 22 36 6 30 28 2 6 42 8 38 36 2 7 4. Profit is maximized at PND

Answer 1

Answer2 : The average revenue is constant and it is always equal to price because in perfect competition firm is the price taker and has no power to change the price in the industry.

Answer 3: Table showing information :

Quantity	FC	VC($)	TC($)	MC ($)	TR($)	MR($)	Profit ($)
0	2	0	2	-	0	-	-2
1	2	8	10	8	6	6	-4
2	2	10	12	2	12	6	0
3	2	13	15	3	18	6	3
4	2	17	19	4	24	6	5
5	2	22	24	5	30	6	8
6	2	28	30	6	36	6	8
7	2	36	38	8	42	6	6

Answer 4: Profit is maximize at MR=MC where price quantity sold is 6 units and profit is $8

Answer 7 a: P=MC

Table showing information:

Market price 1	Profit maximisation output of the firm .P=MC 0.5
2	1
3	1.5
4	2
5	2.5

B : Supply schedule :

Price	Quantity supplied
1	0.5
2	1
3	1.5
4	2
5	2.5