Marginal Analysis

Spencer Bailey, Micro TR

Microeonomics - Econ 2010

Salt Lake Community College
600
500
B(Q)

400

C(Q)

300

N(Q)

200

MB(Q)
MC(Q)

100

MNB(Q)

0
0

-100

B(Q)

C(Q)

N(Q)

MB(Q)

MC(Q)

MNB(Q)

0
1
2
3
4
5
6

0
200
300
390
450
480
500

0
30
70
120
180
255
330

0
170

-200
100
90
60
30
20

-30
40
50
60
75
75

0
170
60
40
0
-45
-55

230
270
270
225
170

Seven Reasons you're at optimal point

1. NB is highest
2. NB Curve is at Peak
3. MB=MC
4. MB+MC lines intersect
5. MNB=0
6. MNB intersects X Axis
7. Furthest verticle distance between TB.TC lines

Output
0
1
2
3
4
5

Price
20
18
16
14
12
10

TR
0
18
32
42
48
50

MR
-$18
$14
$10
$6
$2

TC
20
21
24
30
40
55

ATC
-$21.0
$12.0
$10.0
$10.0
$11.0

MC
-$1
3
$6
$10
$15

Monopoly Profit
-20
-3
8
12
8
-5

2nd Gra

1st Graph - Monopoly

60

50

Series1

50

40

Series2

40

30

Series3

20

Series4

10

Series5

10

Series6

0
-10

Series7

Demand

Demand

60

30
20

Output

4 Steps to Solve for Monopoly Profit

1. Solve for total revenue

2. Solve for Total Cost
3. Subtract Total Revenue from Total Cost
4. Complete equation, Complete

The main thing I learned between the mar

assignment is how firms decide how much
to figure out the ideal rate of production to
the monopoly profit graph, looking at all th
produce 3 units. The profit is at it's highest
produce. The graphs illustrate this as well.

2nd Graph - Monopoly

Series1
Series2
Series3
Series4
2

Output

arned between the marginal analysis assignment and the monopoly profit
firms decide how much to produce. Looking at all of this data you're able
eal rate of production to make the best profit possible. In the example of
it graph, looking at all the data the firm modeled by this would do best to
he profit is at it's highest there and that is where the firm should look to
hs illustrate this as well.