A consulting company estimated market demand and supply in a perfectly competitive industry and obtained the following results:Qd = 25,000 ? 5,000P + 25MQs = 240,000 + 5,000P ? 2,000PIwhere P is price, M is income, and PI is the price of a key input. The forecasts for the next year are 
= $15,000 and 
I = $20. Average variable cost is estimated to beAVC = 14 ? 0.008Q + 0.000002Q2Total fixed cost will be $6,000 next year. Suppose that income next year is forecasted to be $10,000 instead. What will the firm's profit (loss) be?
A. zero
B. -$6,000
C. -$2,856
D. $2,500
E. -$3,550
Answer: C
You might also like to view...
Because the NAAQS are set using a benefit-based decision rule, find the abatement level of sulfur dioxide that would adhere to this rule.
Suppose that the MSB and MSC of abating sulfur dioxide are as follows. Use these functions to answer parts (a) and (b) below. MSB = 32 – 0.2A MSC= 16 + 0.2A
In Niskanen's theory, bureaucrats obtain the budget they want by
a. lowering prices to consumers b. raising prices to consumers c. promising to produce more efficiently d. threatening legislatures with an all-or-nothing choice e. allowing legislators to cut particular items from their budget
Macroeconomics is the study of
a. individual decision makers. b. international trade. c. economy-wide phenomena. d. markets for large products.
U.S. exports create a:
A. Supply of foreign currencies and a demand for dollars in the foreign exchange markets B. Demand for foreign currencies and a supply of dollars in the foreign exchange markets C. Supply of foreign currencies and a supply of dollars in the foreign exchange markets D. Demand for foreign currencies and a demand for dollars in the foreign exchange markets