Scenario 15-1A monopoly firm maximizes its profit by producing Q = 500 units of output. At that level of output, its marginal revenue is $40, its average revenue is $80, and its average total cost is $44.Refer to Scenario 15-1. At Q = 500, the firm's total revenue is

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We start by restating what we know from the scenario: at Q = 500, the average revenue (AR) is $80, which is the price, so the total revenue is price times quantity.

Option 1: $2,000. This would imply either a price of $4 per unit (if TR = P × Q and P = AR), or some other inconsistent combination. But AR is $80, and with 500 units, TR should be 80 × 500 = 40,000, so $2,000 is far too small.

Option 2: $20,000. If TR were $20,000 with Q = 500, the implied average revenue would be TR/Q = 20,000/500 = $40 per unit. However AR is given as $80, so this option contradicts the stated price. Also, MR is $40, which is not used to compute TR directly.

Option 3: $22,000. Similar issue: TR would have to satisfy AR = TR/Q, which would give TR = AR × Q = 80 × 500 = 40,000. $22,000 corresponds to AR = 44 per unit, which again conflicts with the given AR of $80.

Option 4: $40,000. This aligns with TR = AR × Q, since AR = $80 and Q = 500, so TR = 80 × 500 = 40,000. This is the consistent total revenue given the provided AR and quantity.

In summary, to compute total revenue at this quantity, multiply price (AR) by quantity: 80 × 500 = 40,000. The other options do not match the relationship TR = AR × Q and conflict with the given AR value, MR, or basic TR interpretation. The reasoning hinges on distinguishing total revenue (AR × Q) from marginal revenue (MR) and recognizing that MR does not itself determine TR, but rather the change in TR from a small change in Q.}

Microeconomics Week 4 Final Exam Microeconomics Week 4 Final Exam

Scenario 15-1A monopoly firm maximizes its profit by producing Q = 500 units of output. At that level of output, its marginal revenue is $40, its average revenue is $80, and its average total cost is $44.Refer to Scenario 15-1. At Q = 500, the firm's total revenue is

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Microeconomics Week 4 Final Exam Microeconomics Week 4 Final Exam

Scenario 15-1A monopoly firm maximizes its profit by producing Q = 500 units of output. At that level of output, its marginal revenue is $40, its average revenue is $80, and its average total cost is $44.Refer to Scenario 15-1. At Q = 500, the firm's total revenue is

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类似问题

When a perfectly competitive firm sells additional units of output, its total revenue will

A firm has a demand curve of 𝑄 = 25 − 0.5 𝑃 . Which of the following is the correct revenue curve for this firm? Note that the horizontal axis on each graph is quantity and the vertical axis is revenue.

Figure 14-2Suppose a firm operating in a competitive market has the following cost curves:​Refer to Figure 14-2. If the market price is $10, what is the firm's total revenue?

Figure 5-3​Refer toFigure 5-3. At a price of $70 per unit, sellers' total revenue equals

Figure 5-7Refer to Figure 5-7. If, holding the supply curve fixed, there were an increase in demand that caused the equilibrium price to increase from $6 to $7, then sellers' total revenue would

Figure 5-3​Refer toFigure 5-3. At a price of $70 per unit, sellers' total revenue equals

Figure 5-7Refer to Figure 5-7. If, holding the supply curve fixed, there were an increase in demand that caused the equilibrium price to increase from $6 to $7, then sellers' total revenue would

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