Table 71 Table 71 Shows the Short-Run Cost Data of a Perfectly Competitive

question 88

Multiple Choice

Table 7.1
$$\begin{array} { | c | c | c | } \hline \text { Quantity } & \begin{array} { c } \text { Total Cost } \\\text { (dollars) }\end{array} & \begin{array} { c } \text { Variable Cost } \\\text { (dollars) }\end{array} \\\hline 0 & \$ 1000 & \$ 0 \\\hline 100 & 1360 & 360 \\\hline 200 & 1560 & 560 \\\hline 300 & 1960 & 960 \\\hline 400 & 2760 & 1760 \\\hline 500 & 4000 & 3000 \\\hline 600 & 5800 & 4800 \\\hline\end{array}$$ Table 7.1 shows the short-run cost data of a perfectly competitive firm that produces plastic camera cases. Assume that output can only be increased in batches of 100 units.
-Refer to Table 7.1.If the market price of each camera case is $8 and the firm maximises profit,what is the amount of the firm's profit or loss?

• A) $0 (it breaks even)
• B) Loss of $1000
• C) Profit of $440
• D) Loss of $440

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Definitions:

Debit Entry

An accounting entry that results in either an increase in assets or expenses, or a decrease in liabilities or equity, on a company's balance sheet.

Account

A record in financial accounting that tracks the financial transactions related to a specific asset, liability, equity, revenue, or expense.

Credits

Accounting entries that increase liabilities or equity or decrease assets or expenses.

Account Balances

The amounts in financial accounts, representing the net value at a particular point in time after accounting for all debits and credits.