Microeconomics 6th Edition by Robert Hall, Shirley Kuiper, Marc Lieberman

Exercise 9

Suppose that the cost data in problem 1 are for the short run,and that the owner of the practice suddenly realizes that she forgot to include her only fixed cost: her license fee of $2,600 per year (which is $50 per week). Should the practice shut down in the short run? Why or why not?
Problem 1
The owner of an optometry practice,in a city with more than a hundred other such practices,has the following demand and cost schedules for eye exams:
a. Fill in the columns for total revenue,marginal revenue,and marginal cost. (Remember to put MR and MC between output levels.)b. Briefly explain why an optometry practice (like this one)might face a downward-sloping demand curve,even if it is one out of more than a hundred. (Hint: What might make this market monopolistically competitive rather than perfectly competitive?)c. Use the data you filled in for the marginal revenue and marginal cost columns to find the profitmaximizing price and the profit-maximizing number of eye exams per week for this practice.