1. Consider total cost and total revenue given in the table below:
QUANTITY 0
Total cost
$8
Total revenue 0
1
$9
8
2
$10
16
3
$11
24
4
$13
32
5
$19
40
6
$27
48
7
$37
56
a. Calculate profit for each quantity. How much should the firm produce to maximize
profit?
b. Calculate marginal revenue and marginal cost for each quantity. Graph them. (Hint:
Put the points between whole numbers. At what quantity do these curves cross? How
does this relate to your answer to part (a)?
c. Can you tell whether this firm is in a competitive industry?