1. At what production level would the marginal cost exceed the average cost?  2. How many barrels of natural-organic oil reflect the lowest minimum average variable cost? 3. How much is the fixed cost to produce the natural-organic oil?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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Use the graphical illustration to answer the following questions: (if required, use the discreet number of barrels)

 

1. At what production level would the marginal cost exceed the average cost? 
2. How many barrels of natural-organic oil reflect the lowest minimum average variable cost?
3. How much is the fixed cost to produce the natural-organic oil?

550
500
450
400
8350
300
Amount in '00
250
200
150
100
50
0
0
Natural-Organic Oil
1 2 3 4 5 6 7 8 9 10
Barrels
Marginal Revenue -
Marginal Cost -
-AFC-
AVC-
11
-ATC-
12
Transcribed Image Text:550 500 450 400 8350 300 Amount in '00 250 200 150 100 50 0 0 Natural-Organic Oil 1 2 3 4 5 6 7 8 9 10 Barrels Marginal Revenue - Marginal Cost - -AFC- AVC- 11 -ATC- 12
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