Review Question for Chapter13, due April 22nd, 3 points Price(dollars percopy)Quantitydemanded(copies per day)0.40 5000.50 4000.60 3000.70 2000.80 1000.90 0Quantityproduced(copies per day)Total cost(dollars per day) 0 100100 105200 120300 145400 180500 2253) Pinesboro Herald is the only local newspaper in the city of Pinesboro. The publisher faces the demand schedule shown in the first table above and has the cost schedule shown in the second table above.a) Complete the following table. Quantity(copies per day)Price(dollars)TR(dollars)MR(dollars)TC(dollars)MC(dollars)ATC(dollars) 0 0.90 0 100 0100 0.80 80 0.80 105 0.05 1.05200 0.70 140 0.60 120 0.15 0.60300 0.60 180 0.40 145 0.25 0.48400 0.50 200 0.20 180 0.35 0.45500 0.40 200 0.00 225 0.45 0.45b) The figure shows the demand curve, the marginal revenue curve and marginal and average total cost curves. What are the publisher's profit-maximizing output and price? What is the publisher's economic profit per day?The publisher maximizes its profit by producing 300 copies per day. At this level of output MC = MR = $0.30. The market price is $0.60 per copy. If the publisher prints 300 copies per day, its average total cost is $0.48 per copy. So the economic profit per copy is $0.60 - $0.48 = $0.12 percopy. And the total economic profit is $0.12 profit per copy × 300 copies per day, or $36 per day.d) At the price charged, is the demand for newspapers elastic or inelastic? Explain your answer.The demand for newspapers is elastic. At the price charged, the marginal revenue is positive, which means that means the total revenue increases if the quantity sold increases and decreases ifthe quantity sold decreases.e) Does the publisher use resources efficiently? What is the deadweight loss? Explain your answerThe publisher does not use resources efficiently. At the profit-maximizing output level, the marginal benefit is $0.60, from the demand curve, which exceeds the marginal cost of $0.48. Theefficient level of output is 450 copies per day. The deadweight loss is equal to the area of the darkened triangle in the figure above. This area equals ($0.60 - $0.30) × (450 - 300)/2 = $22.5 per day.f) If the publisher could perfectly price discriminate, how much is the output? What is the price? Does the publisher use resources efficiently? Explain your answerThe level of output is 450 copies per day. Price is different for each unit. The publisher uses resources
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