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You Are Given the Following Cost and Revenue Information for Cindy's

question 70

Essay

You are given the following cost and revenue information for Cindy's Candles,a perfectly competitive firm at its current level of output.
AFC = 4
ATC = 10
TVC = 600
MC = 10
TR = 1,200
a)What is the amount of profit or loss?
b)Is the firm producing at its optimal level? If not,should it increase or decrease output?
a)Economic profit = $200


Definitions:

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return.

Trust Fund

A fund comprised of a variety of assets intended to provide benefits to an individual or organization.

Effective Rate

is the interest rate on a loan or financial product, restated from the nominal rate as an annual rate that may incorporate compounding.

Endowment Fund

A financial endowment given to institutions like universities, museums, and non-profits to invest and use the annual income from investments for operations or programs.

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