Jeannette has a wheat farm, and the wheat market is perfectly competitive. The market price of a bushel of wheat is $18, and Jeannette’s machinery costs $140 per day and is the only fixed input. Her variable cost consists of the wages paid to the farm workers, and the fertilizer. The variable cost per day associated with each level of output is given by the table below. Calculate the total cost, the average variable cost, the average total cost, and the marginal cost for each quantity of output. Q VC TC MC AVC ATC 0 0 10 160 20 220 30 300 40 420 50 580 60 780 70 1,020
Jeannette has a wheat farm, and the wheat market is perfectly competitive. The market price of a bushel of wheat is $18, and Jeannette’s machinery costs $140 per day and is the only fixed input. Her variable cost consists of the wages paid to the farm workers, and the fertilizer. The variable cost per day associated with each level of output is given by the table below. Calculate the total cost, the average variable cost, the average total cost, and the marginal cost for each quantity of output. Q VC TC MC AVC ATC 0 0 10 160 20 220 30 300 40 420 50 580 60 780 70 1,020
Chapter12: Firms In Perfectly Competitive Markets
Section: Chapter Questions
Problem 9P
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Question
Jeannette has a wheat farm, and the wheat market is
The market price of a bushel of wheat is $18, and Jeannette’s machinery costs $140 per day and is the only fixed input.
Her variable cost consists of the wages paid to the farm workers, and the fertilizer. The variable cost per day associated with each level of output is given by the table below.
Calculate the total cost, the
Q |
VC |
TC |
MC |
AVC |
ATC |
0 |
0 |
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|
|
10 |
160 |
|
|
|
|
20 |
220 |
|
|
|
|
30 |
300 |
|
|
|
|
40 |
420 |
|
|
|
|
50 |
580 |
|
|
|
|
60 |
780 |
|
|
|
|
70 |
1,020 |
|
|
|
|
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