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(Solved): This problem gives you a preview of something you might see in a microeconomics class. Suppose ther ...
This problem gives you a preview of something you might see in a microeconomics class. Suppose there's an appliance store that seils dishwashers. It could set its price high and sell very few dishwashers, or it could set its price low and sell many more dishwashers. The following table shows some possible choices this store could make: The graph below plots the firm's total revenue curve: that is, the relationship between quantity and total revenue given by the two right columns in the tabie ts bove. The five choices are also labeled. Finally, two black lines are shown; these lines are tangent to the green curve at points B and \( D \).
The graph below plots the firm's total revenue curve: that is, the relationship between quantity and total revenue given by the two right columns in the table above. The five choices are also labeled. Finally, two black lines are shown; these lines are tangent to the green curve at points \( B \) and \( D \).
Using the information on the slope of the lines tangent to the curve at points \( B \) and \( D \), plot the slope of the total revenue curve on the graph below. (As it turns out, it's a straight line, so the two points you piot will determine a Nine.) The total revenue curve reaches its maximum of a quantity of dishwashers per yeac. At this point, the slepe of the total revenue curve is
Answer : 1.) Shape of Total Revenue Curve : At point B the slope of the line = ($48000 - $24000) / (180 - 60) = 200 At point D the slope of the line = ($24000 - $48000) / (420 - 300) = -200 Explanation : The total revenue curve for a firm with market