2.2 Use the table below to answer Questions 2.1.1 and 2.1.2 relating to costs of a...

 

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2.2 Use the table below to answer Questions 2.1.1 and 2.1.2 relating to costs of a perfectly competitive market. 2.3 Output 10 12 14 16 20 Average variable cost 5.00 4.00 4.75 5.75 9.00 Average total cost 15.00 13.00 11.50 9.00 12.00 Marginal cost 3 4 6 9 2.1.1 If the marginal revenue is R6,00 what output level will the firm produce? Motivate your answer. (6) 2.1.2 At which output level will the firm NOT produce? Provide a motivation for your answer. (6) 14 Explain why the demand for a luxury good is generally more elastic than the demand for a necessity good. Evaluate two (2) methods of allocating scarce resources in an economy. (6) (12) 2.2 Use the table below to answer Questions 2.1.1 and 2.1.2 relating to costs of a perfectly competitive market. 2.3 Output 10 12 14 16 20 Average variable cost 5.00 4.00 4.75 5.75 9.00 Average total cost 15.00 13.00 11.50 9.00 12.00 Marginal cost 3 4 6 9 2.1.1 If the marginal revenue is R6,00 what output level will the firm produce? Motivate your answer. (6) 2.1.2 At which output level will the firm NOT produce? Provide a motivation for your answer. (6) 14 Explain why the demand for a luxury good is generally more elastic than the demand for a necessity good. Evaluate two (2) methods of allocating scarce resources in an economy. (6) (12)

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211 The firm will produce at an output level where marginal cost equals marginal revenue In this cas... View the full answer