The Table Shows the Relationship Between Output, Total Costs, and Total

question 142

Multiple Choice

The table shows the relationship between output, total costs, and total revenue for a pure monopoly. $\begin{array} { | c | c | c | } \hline \text { Output } & \text { TC } & \text { TR } \\\hline 50 & \$ 750 & \$ 1,000 \\\hline 60 & 800 & 1,100 \\\hline 70 & 950 & 1,250 \\\hline 80 & 1,200 & 1,450 \\\hline 90 & 1,300 & 1,500 \\\hline\end{array}$ Within which of the following ranges of output will the firm earn maximum economic profits?

• A) 50 to 60 units
• B) 60 to 70 units
• C) 70 to 80 units
• D) 80 to 90 units

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Definitions:

Equivalent Units

A concept in process costing, used to convert partially completed units into a number of equivalent fully completed units to uniformly measure and assign costs.

Circuit Prep Department

A specialized section within an electronics manufacturing or repair facility where circuits are prepared or assembled.

First-In, First-Out Method

An inventory valuation method where the oldest inventory items are recorded as sold first, potentially affecting cost of goods sold and ending inventory valuation.

Shaping Department

A division in a manufacturing process that focuses on altering raw materials into desired shapes or forms required for the final product.