Complete the following table for a perfectly competitive fir

Complete the following table for a perfectly competitive firm Instructions: Enter your responses rounded to two decimal places Output Total Cost Marginal Cost Average Total Cost Average Variable Cost $100 110 130 170 10 15 20 25 30 35 290 380 490 Instructions: Enter your response as a whole number. Indicate a negative response with a -) negative sign. (a) If the price is $10, how much output will the firm supply? units (b) How much profit or loss will it make? (c) At what price will the firm shut down? Click to select) v

Solution

Total Cost=Fixed Cost+Variable Cost

Variable Cost=bQ and Fixed Cost=a

Total Cost=a+bQ

FIxed Cost=a=100

For Competitive firm

Price=MC=10 then output is 20

Profit made when Price is $10 equals to P*Q-C=10*20-220=-20

Below $20 Price Firm will shut down

Output	Total Cost	Marginal Cost	Average Cost	Average Variable Cost
0	100			0
5	110	2	22	2
10	130	4	13	3
15	170	8	11.33333333	4.666666667
20	220	10	11	6
25	290	14	11.6	7.6
30	380	18	12.66666667	9.333333333
35	490	22	14	11.14285714