The Table Below Shows the Demand and Cost Data Facing

question 185

Essay

The table below shows the demand and cost data facing "Velvet Touches," a monopolistically competitive producer of velvet throw pillows.

Use the data to answer the following questions.
a.Complete the Total Revenue (TR), Marginal Revenue (MR), and Marginal Cost (MC)columns above.
b.What are the profit-maximizing price and quantity for Velvet Touches?
c.Is the firm making a profit or a loss? How much is the profit or loss? Show your work.
d.Is this firm operating in the long run or in the short run? Explain your answer.
e.If the firm's profit or loss is typical of all firms in the market for throw pillows, what is likely to happen in the future? Will there be more firms or will some existing firms leave the industry? Explain your answer.
f.What will happen to the typical firm's profit or loss after all entry/exit adjustments?

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Definitions:

Psychological Attributes

Characteristics of an individual's psychological makeup, including personality traits, attitudes, motivations, and emotions.

Mission Statement

A formal summary of the aims and values of a company, organization, or individual.

Human Resources

The department within an organization that focuses on recruitment, management, and providing direction for the people who work in the organization.

Stability Strategy

A business approach that focuses on maintaining current operations and market position without significant growth or change.