Question: As the manager of a custom automobile refinishing company, Clearly Reliable Automobile Paint Company. You are concerned with determining the profit maximizing level of output. You have commissioned a market survey which has yielded the information that your total revenue is given by the equation

you also have studied your production process and know that CRAPCO's total cost curve is given by

1. Is this a perfect or an imperfect competitor? How do you know? HINT: Use the data given-not the industry.
2. To the nearest whole automobile, at what quantity will profits be maximized? Remember that the profit maximizing quantity is found by equating at marginal revenue and marginal cost. Use this quantity in all remaining calculations where \(Q\) is required for this question.
3. To the nearest penny, what will be the profit maximizing Price that will be paid?
4. What is the average total cost at the profit maximizing quantity?
5. What is the average variable cost at the profit maximizing quantity?
6. If costs and revenues are given by the equations above, what is the profit which will be earned at the profit maximizing level of output?
7. What is the quantity of automobiles at which this firm will minimize its average total cost? What will that total cost be.

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