Assume the price of a product is $20, and the table below shows total costs for various levels of output. [table]
Quantity | 0 | 1 | 2 | 3 | 4 | 5 | 6 Total Costs | $15 | $20 | $22 | $28 | $37 | $58 | $105
[/table] What is the profit when output is 0? (Do not use the dollar sign in your answer, but do indicate if profit is negative by typing the - sign before the number)

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BlackTom AI · Accepted Answer

The question provides a price of 20 and a table of total costs for different outputs. We are asked to find profit when output is 0.
First, compute total revenue at q = 0: Revenue = price × quantity = 20 × 0 = 0.
Next, note the total cost at q = 0 from the table: Total Costs = 15.
Profit is defined as Revenue minus Total Costs: Profit = Revenue − Total Costs = 0 − 15 = −15.
Since there is no output, there is no revenue, while costs of 15 still incur, yielding a negative profit of −15.
No other outputs are involved in this calculation, and the result aligns with the basic profit formula.

MUF0061 Economics Unit 1 - Semester 2, 2025 Quick Calculations - How can a firm maximise profit? (5 -10 minutes)

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