Use the table to answer the following questions: Quantity of yams(kg) Total Revenue (TR) Marginal...
ECONOMICS
WAEC 1997
Use the table to answer the following questions:
| Quantity of yams(kg) | Total Revenue (TR) | Marginal Revenue (MR) | Total Cost (TC) | Marginal Cost (MC) |
| N | N | N | N | |
| 0 | 0 | - | 5 | - |
| 1 | 9 | 9 | 8 | 3 |
| 2 | 18 | 9 | 6 | T |
| 3 | 24 | 6 | 21 | 5 |
| 4 | 28 | Q | 25 | 4 |
| 5 | 30 | 2 | 25 | U |
| 6 | P | 1 | 25 | 0 |
| 7 | 28 | -3 | S | 1 |
| 8 | 24 | R | 24 | -2 |
(a) Complete the table by calculating the missing figures P,Q,R,S,T,U.
(b)At what out-put is profit maximized?
(c) Calculate the profit when quantity sold is 5.
(d) At what output does MC begin to rise?
Explanation
(a)Total Revenue at P = 30 + 1 = N31
Marginal Revenue at Q = N28 - N24 = N4
Marginal Revenue at R = N24 - N28 = -N4 Total Cost at S = N25 + Ni = N26
Marginal cost at T = N16 - N8 = N8
Marginal cost at U = N25 - N25 = NO
(b) The profit is maximized at output 4kg of yams when MC = MR
(c) At output 5kg, Profit = TR - TC = N30 - N25 = N5
(d) Marginal cost (MC) begins to rise from output
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