Homework Sourse26 On the Diagram Average Fixed Cost is the highest at what
26. On the Diagram Average Fixed Cost is the highest at what quantity?
27. On the diagram Average VARIABLE is the highest at what quantity?
28. What kind of industry is this frim in?
29. What is the profit maximizing Quanity on this frim?
30. What is the profit maximizing price for this frim?
31. Exactly how much profit will the frim make if they sell the Quanity you answered for question (29) at the price you answered for question (30)
ra 2 Reven 100 400 700 %00 Solution
Ans: 1. The industry is a kind of a monopoly.
2. The profit maximising quantity is 100 units
3. The profit maximising price is $12
4. At the level of price and quantiy set by the monopoly as above, TR= $1200 and the total cost = $100*4= $400.
Thus profits are $800
