Table 73 Arnie Sells Basketballs in a Perfectly Competitive Market

question 8

Multiple Choice

Table 7.3
$$\begin{array} { | c | r | r | c | } \hline \text { Quantity } & \text { Total Cost } & \text { Total Cost } & \text { Marginal } \\\hline 0 & \$ 10.00 & - - - - & - - - - \\\hline 1 & 15.00 & \$ 15.00 & \$ 5.00 \\\hline 2 & 17.50 & 8.75 & 2.50 \\\hline 3 & 22.50 & 7.50 & 5.00 \\\hline 4 & 30.00 & 7.50 & 7.50 \\\hline 5 & 40.00 & 8.00 & 10.00 \\\hline 6 & 52.50 & 8.75 & 12.50 \\\hline 7 & 67.50 & 9.64 & 15.00 \\\hline 8 & 85.00 & 10.63 & 17.50 \\\hline 9 & 105.00 & 11.67 & 20.00 \\\hline\end{array}$$ Arnie sells basketballs in a perfectly competitive market. Table 7.3 summarises Arnie's output per day (Q) , total cost (TC) , average total cost (ATC) , and marginal cost (MC) .
-Refer to Table 7.3.What will Arnie's output be and how much profit will he earn if the market price of basketballs is $5.00?

• A) Q = 1; profit = -$10
• B) Q = 3; profit = -$7.50
• C) Q = 0; profit = -$10.00
• D) Price and profit cannot be determined from the information given.

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