4. Problems and Applications Q4 Ball Bearings, Inc., faces costs of production as follows: Quantity Total Fixed Costs Total Variable Costs (Dollars) (Dollars) 0 100 0 1 100 50 2 100 70 3 100 90 4 100 140 5 100 200 6 100 360 Complete the following table by calculating the company's total cost, marginal cost, average fixed cost, average variable cost, and average total cost at each level of production. Quantity Total Cost Marginal Cost Average Fixed Cost Average Variable Cost Average Total Cost (Dollars) (Dollars) (Dollars) (Dollars) (Dollars) 0 1 2 3 4 5 6 The price of a case of ball bearings is $50. Seeing that he can't make a profit, the company's chief executive officer (CEO) decides to shut down operations. The firm's profit in this case is . (Note: If the firm suffers a loss, enter a negative number in this cell.) True or False: This was a wise decision. True False Vaguely remembering his introductory economics course, the company's chief financial officer tells the CEO it is better to produce 1 case of ball bearings, because marginal revenue equals marginal cost at that quantity. At this level of production, the firm's profit is . (Note: If the firm suffers a loss, enter a negative number in this cell.). True or False: This is the best decision the firm can make. True False

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 4PA

See similar textbooks

4. Problems and Applications Q4

Ball Bearings, Inc., faces costs of production as follows:

Quantity	Total Fixed Costs	Total Variable Costs
(Dollars)	(Dollars)
0	100	0
1	100	50
2	100	70
3	100	90
4	100	140
5	100	200
6	100	360

Complete the following table by calculating the company's total cost, marginal cost, average fixed cost, average variable cost, and average total cost at each level of production.

Quantity	Total Cost	Marginal Cost	Average Fixed Cost	Average Variable Cost
(Dollars)	(Dollars)	(Dollars)	(Dollars)	(Dollars)
0

1

2

3

4

5

6

The price of a case of ball bearings is $50. Seeing that he can't make a profit, the company's chief executive officer (CEO) decides to shut down operations.

The firm's profit in this case is ____________. (Note: If the firm suffers a loss, enter a negative number in this cell.)

True or False: This was a wise decision.

True

False

Vaguely remembering his introductory economics course, the company's chief financial officer tells the CEO it is better to produce 1 case of ball bearings, because marginal revenue equals marginal cost at that quantity.

At this level of production, the firm's profit is ____________. (Note: If the firm suffers a loss, enter a negative number in this cell.).

True or False: This is the best decision the firm can make.

True

False

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions