In a situation when a firm is operating in a perfectly competitive firm and the total cost is given perfectly competitive firm and the total cost is given a...
Question 1 Report
In a situation when a firm is operating in a perfectly competitive firm
and the total cost is given perfectly competitive firm and the total
cost is given as N75.00. If the market price is N7.00 determine the
profit. When 25 units are produced
Answer Details
Total cost (Tc) = N75.00
Price (P) = N7.00
Output (Q) = N25 units
Profit = ?
To derive the profit of the firm, the total revenue must be expressed. It can be expressed as
Total revenue (TR) = Price (P) × Quantity (q)
Therefore, TR = P × Q
= 7 × 25 units
Tr = N175
Therefore, Profit = TR – TC
= N175 – N75
Profit = N100
Price (P) = N7.00
Output (Q) = N25 units
Profit = ?
To derive the profit of the firm, the total revenue must be expressed. It can be expressed as
Total revenue (TR) = Price (P) × Quantity (q)
Therefore, TR = P × Q
= 7 × 25 units
Tr = N175
Therefore, Profit = TR – TC
= N175 – N75
Profit = N100
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