Answer to Question #210200 in Microeconomics for dilpreet

Question

you operate balvinders best broccoli boutique in burnbay BC in a perfectly environment . You have the folleintbinformation. you want to decide how much you should produce, and what price you should charge. conplete the chart , and answer the question below. Use rwo decimals in you answers. Hint conplete you cost calculations first and review the lecture notes o the relationship of the MC curve to the AATC and AVC curves then to calculate your revenue values remember that this is a perfect copetition . hey plz snswer this question in very detail calculation so that i can understand how this answer come what os its formuls and answer with telling how you find the price i tried but i m not able to find price i know other how to gind but due to price i m not sble to solve this question

Answer 1

The complete question is

Solution

part 1

the completed table

Part 2 & 3:

A perfectly competitive firm earns only 'normal profits' which are included in its total cost (TC). In other words, for such a firm TC = TR. It also means that TC/Q = TR/Q, or say ATC = AR. So, the price can be obtained from the point where the firm's ATC is at its lowest (else, at any other level of ATC the firm will make losses). We can see in the table that ATC is lowest at 1.22 at the production level of 100 as well as at 200 units. Naturally choosing the higher quantity, the loss minimizing output level will be 200 units, the price will be 1.22, and profit or better say the minimum loss will be zero.

Profit maximizing price = 1.22

Profit maximizing quantity = 200 units

Profit = 0