If a monopolist's price is $20 at 20 units of output and marginal revenue equals marginal cost and average total cost equals $15, then the firm's total profit is:

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BlackTom AI · Accepted Answer

We start by identifying the key quantities given: price P = 20, output Q = 20, average total cost ATC = 15, and the condition that marginal revenue equals marginal cost (MR = MC). From ATC and Q, total cost (TC) = ATC × Q = 15 × 20 = 300. From price and quantity, total revenue (TR) = P × Q = 20 × 20 = 400. Profit = TR − TC = 400 − 300 = 100.

Option a. $100: This matches the calculated profit 100, obtained from TR minus TC, given P = 20, Q = 20, and ATC = 15.

Option b. $400: This would be the total revenue, not profit. It ignores subtracting total cost, which is required to obtain profit. The error lies in conflating revenue with profit.

Option c. $5: This would reflect a small profit per unit or a mistaken calculation (for example, if someone mistakenly used a different cost figure or divided profit across units). It does not align with TR − TC = 400 − 300 = 100.

Option d. $300: This equals the total cost (TC) here, which would indicate zero profit (TR = TC). Since TR = 400 and TC = 300, profit is not zero but 100, so this option misstates the relationship between revenue and cost.

If a monopolist's price is $20 at 20 units of output and marginal revenue equals marginal cost and average total cost equals $15, then the firm's total profit is:

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If a monopolist's price is $20 at 20 units of output and marginal revenue equals marginal cost and average total cost equals $15, then the firm's total profit is:

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登录即可查看完整答案

类似问题

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 profit is

Figure 16-5The following graph depicts the market situation for a monopoly pastry shop called Bearclaws.​Refer to Figure 16-5.Given that Bearclaws chooses the profit-maximizing price and quantity, what profit level will it obtain?

Figure 16-5The following graph depicts the market situation for a monopoly pastry shop called Bearclaws.​Refer to Figure 16-5.Given that Bearclaws chooses the profit-maximizing price and quantity, what profit level will it obtain?

Figure 16-5The following graph depicts the market situation for a monopoly pastry shop called Bearclaws.​Refer to Figure 16-5.Given that Bearclaws chooses the profit-maximizing price and quantity, what profit level will it obtain?

A monopoly’s profit can be calculated as:

What is the monopolist’s profit under the following conditions? The profit-maximising price charged for goods produced is $40. The intersection of the marginal-revenue and marginal cost-curves occurs where output is 20 units and marginal cost is $25. Average cost for 20 units of output is $15.

If a monopolist sells 200 units at $10 per unit and realises an average total cost of $6 per unit, what is the monopolist’s profit?

更多留学生实用工具

希望你的学习变得更简单

Figure 16-5The following graph depicts the market situation for a monopoly pastry shop called Bearclaws.Refer to Figure 16-5.Given that Bearclaws chooses the profit-maximizing price and quantity, what profit level will it obtain?

Figure 16-5The following graph depicts the market situation for a monopoly pastry shop called Bearclaws.Refer to Figure 16-5.Given that Bearclaws chooses the profit-maximizing price and quantity, what profit level will it obtain?

Figure 16-5The following graph depicts the market situation for a monopoly pastry shop called Bearclaws.Refer to Figure 16-5.Given that Bearclaws chooses the profit-maximizing price and quantity, what profit level will it obtain?