The blue curve on the following graph represents the demand curve facing a firm that can set its own prices. Use the gra

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The Blue Curve On The Following Graph Represents The Demand Curve Facing A Firm That Can Set Its Own Prices Use The Gra 1 (24.85 KiB) Viewed 56 times

The blue curve on the following graph represents the demand curve facing a firm that can set its own prices. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. Graph Input Tool Market for Goods 200 180 Quantity Demanded 20 160 140 Demand Price (Dollars per unit) 100.00 120 80 60 Demand 40 20 0 n 12 16 20 24 28 32 36 40 QUANTITY (Units) PRICE (Dollars per unit) 0
On the graph input tool, change the number found in the Quantity Demanded field to determine the prices that correspond to the production of 0, 8, 16, 20, 24, 32, and 40 units of output. Calculate the total revenue for each of these production levels. Then, on the following graph, use the green points (triangle symbol) to plot the results. 2000 1800 Total Revenue 1600 1400 1200 1000 800 600 TO TAL REVENUE (Dollars) 400 + 200 0 0 4 8 12 16 20 24 28 QUANTITY (Number of units) 32 36 40
Calculate the total revenue if the firm produces 8 versus 7 units. Then, calculate the marginal revenue of the eighth unit produced. The marginal revenue of the eighth unit produced is S Calculate the total revenue if the firm produces 16 versus 15 units. Then, calculate the marginal revenue of the 16th unit produced. The marginal revenue of the 16th unit produced is Based on your answers from the previous question, and assuming that the marginal revenue curve is a straight line, use the black line (plus symbol) to plot the firm's marginal revenue curve on the following graph. (Round all values to the nearest increment of 40.) 200 160 Marginal Revenue 120 80 40 MARGINAL REVENUE (Dollars) -40 0 8 12 16 20 24 QUANTITY (Units) 28 32 36 8
Comparing your total revenue graph to your marginal revenue graph, you can see that when total revenue is decreasing, marginal revenue is