The Costs of Production AssignmentMr. Krabs owns the Krusty Krab, a small restaurant with a single frying machine and a fry cookThe house specialty is their Krabby Patty-famous all across Bikini Bottom. The Krusty Krab'sfixed costs are the rent ($50), the fry machine (520), and the owner's salary ($30). The fry cook,Sponge Bob, earns $8 per hour.1. Complete the following tableKrabby Hours TFC TVC TC MC AFC AVC ATCof laborPatties0801020304050607080131620253240502. Sketch the MC, ATC and AVC curves for the Krusty Krab.3. What will happen to the MC if Mr. Krabs increases his salary to $60?4. What will happen to the MC if Mr. Krabs increases SpongeBob's salary to $10 per hour?5. At what price will Mr. Krabs shut down?

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The Costs of Production Assignment Mr. Krabs owns the Krusty Krab, a small restaurant with a single frying machine and a fry cook The house specialty is their Krabby Patty-famous all across Bikini Bottom The Krusty Krab's fixed costs are the rent ($50), the fry machine (520), and the owner's salary ($30). The fry cook Sponge Bob, earns $8 per hour. 1. Complete the following table Krabby Patties 0 10 20 30 40 50 60 70 80 Hours TFC TVC TC MC of labor 0 8 13 16 20 25 32 40 AFC AVC 50 2. Sketch the MC, ATC and AVC curves for the Krusty Krab XXX 3. What will happen to the MC if Mr. Krabs increases his salary to $60? ATC XXXX

The Costs of Production Assignment Mr. Krabs owns the Krusty Krab, a small restaurant with a single frying machine and a fry cook The house specialty is their Krabby Patty-famous all across Bikini Bottom The Krusty Krab's fixed costs are the rent ($50), the fry machine (520), and the owner's salary ($30). The fry cook Sponge Bob, earns $8 per hour. 1. Complete the following table Krabby Patties 0 10 20 30 40 50 60 70 80 Hours TFC TVC TC MC of labor 0 8 13 16 20 25 32 40 AFC AVC 50 2. Sketch the MC, ATC and AVC curves for the Krusty Krab XXX 3. What will happen to the MC if Mr. Krabs increases his salary to $60? ATC XXXX

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter7: Production, Costs, And Industry Structure

Section: Chapter Questions

Problem 31CTQ: A common name for fixed cost is overhead. If you divide fixed cost by the quantity of output...

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