ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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1. The Al-Maskri Company in Seeb makes flower pots and receives RO 10 for each finished pot. Mr. Al-Maskri’s only factors of production are flower pot machine operators (labor) and a small building where the laborers work from. The number of flower pots per day the company produces depends on the number of employee-hours per day as shown below. The wage is RO 15 per hour.

Number of pots per day Number of employee-hours per day
0 0
5 1
10 2
15 4
20 7
25 11
30 16
35 22

(a) Mr. Al-Maskri’s daily fixed cost for the flower pot making machine and building is RO 60. Complete the following Table showing total revenue, variable cost, total cost, and daily profit for various quantities of daily flower pot production.

Quantity of
Pots per day Total Revenue
RO per day Variable Costs
RO per day Total Costs
RO per day Profit
RO per day
0 0 0 60 -60
5 75 -25
10
15
20 105
25
30 300
35 -40


(b) The profit maximizing quantity of pots is __________ and at that number of pots the daily profit made is RO ________________________.

(a) Mr. Al-Maskri's daily fixed cost for the flower pot making machine
and building is RO 60. Complete the following Table showing total
revenue, variable cost, total cost, and daily profit for various
quantities of daily flower pot production.
Quantity of
Pots per day
Total
Variable
Total Costs
Profit
Revenue
Costs
RO per day
RO per day
RO per day
RO per day
60
-60
75
-25
10
15
20
105
25
30
300
35
-40
(b) The profit maximizing quantity of pots is
of pots the daily profit made is RO
and at that number
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Transcribed Image Text:(a) Mr. Al-Maskri's daily fixed cost for the flower pot making machine and building is RO 60. Complete the following Table showing total revenue, variable cost, total cost, and daily profit for various quantities of daily flower pot production. Quantity of Pots per day Total Variable Total Costs Profit Revenue Costs RO per day RO per day RO per day RO per day 60 -60 75 -25 10 15 20 105 25 30 300 35 -40 (b) The profit maximizing quantity of pots is of pots the daily profit made is RO and at that number
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