A Firm Operates in a Competitive Industry, in Which the Price

question 49

Essay

A firm operates in a competitive industry, in which the price is $8 per unit. Its fixed cost is $10 and its variable costs are given in the table. Compute the firm's revenues and costs for output over the range 0 to 8 units. Determine the profit-maximizing level of output for the firm. If this firm is typical of the industry, will entry occur? Explain why or why not.
$\begin{array} { | c | c | } \hline \text { Output } & \text { Variable cost } \\\hline 1 & 2 \\\hline 2 & 3 \\\hline 3 & 5 \\\hline 4 & 10 \\\hline 5 & 16 \\\hline 6 & 24 \\\hline 7 & 35 \\\hline 8 & 48 \\\hline\end{array}$

---

Definitions:

Control Panel

A part of the operating system that provides users with the ability to change system preferences and oversee the operation of hardware and software capabilities.

Icons

Small graphical symbols or images that represent programs, files, functions, or commands within a computer interface.

Dialog Box

A small window that prompts the user to enter information or select options when interacting with software applications.

Standard User

A type of computer account with permissions to use most software and system functions but restricted from making significant changes that affect system security or other users.