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PRICE ($) 50 45 40 35 30 25 20 15 10 5 0
QUANTITY DEMANDED 0 1 2 3 4 5 6 7 8 9 10
Mike's Mechanical toy is a sole producer of battery operated robots in Funville. The above table shows the daily demand for robots. Mike faces a fixed cost of $50 each day and his MC for each additional unit is three times the number of units supplied, i.e. MC of first unit = 1*3 = 3, MC of second unit = 2*3 = 6, MC of 3rd unit = 3*3 = 9, MC of the 4th unit = 3* 4 = 12...and so on.
a. Calculate Mike's TR, and TC for each quantity supplied.
b. What will be the profit maximizing quantity of robots for Mike's Mechanical toy co. to supply?
c. Calculate the profits that Mike's company will earn?
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