Economics Question-Assume a firm has fixed costs of $80 and variable costs as indicated in the table below. Complete the cost table.

1. Assume a firm has fixed costs of $80 and variable costs as indicated in the table below. Complete the cost table.
Total product
Total variable cost
Total
cost
AFC
AVC
ATC
MC
0
$ 0
$ 80
—
—
—
—
1
110
190
$_____
$_____
$_____
$_____
2
150
230
_____
_____
_____
_____
3
180
260
_____
_____
_____
_____
4
220
300
_____
_____
_____
_____
5
270
350
_____
_____
_____
_____
6
340
420

_____
_____
_____
_____
7
440
520
_____
_____
_____
_____
8
580
660
_____
_____
_____
_____
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2. Ahmad quit his job at bank Muscat where he earned $70,000 a year. He used his saving of $100,000 in the bank that earned him 10% interest annually to buy a van taxi. Ahmad decided to buy the taxi and set up a commuter service between Barakah and Ruwi. There are 1000 people who will pay $400 a year each for the commuter service; $280 from each person goes for gas, maintenance, insurance, and depreciation. Calculate:
(a) Ahmad’s total revenues; explicit costs & accounting profit.
(b) Economic costs & Economic profit or loss.
—-
3. An airline is flying between two cities. The airline has the following costs associated with the flight:
Crew $4000 Plane daily depreciation $2000
Fuel 1000 Plane daily insurance 2000
Landing fee 1000
The airline has an average of 40 passengers paying an average of $200 for this flight.
Do you think the airline should be flying between the two cities? Evaluate from a short run
Profit maximization perspective.

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