The following table shows Farmer Parker's revenue, cost, and profit from wheat farming Quantity (bushels) (Q) Total Revenue Total Cost Marginal Revenue (MR) Marginal Cost (MC) Profit (TR-TC) $-3.00 -2.00 0.00 2.50 4.50 6.00 6.00 5.50 2.50 -3.00 (TR) $0.00 (TC) $3.00 6.00 8.00 9.50 11.50 1. 4.00 $4.00 3.00 8.00 12.00 16.00 20.00 4,00 2.00 3. 4.00 1.50 4.00 2.00 2.50 4.00 14.00 4.00 4.00 4.00 18.00 22.50 29.50 39.00 51.50 24.00 28.00 32.00 36.00 40.00 4.50 7.00 4.00 4.00 9.50 - 11.50 4.00 12.50 Farmer Parker's profit-maximizing level of production is 6 bushels of wheat. At this level of production he produces following the rule Marginal Revenue = Marginal Cost and earns the maximum possible profit of $6.00. Farmer Parker's fixed costs are $3. (Enter your responso rounded to two decimal places.) Suppose that foced costs increase by $1.50. Farmer Parker's new profit-maximizing level of production after the increase in fixed costs isbushels of wheat The amount of profit that Farmer Parker will eam after the increase in fixed costs is $ (Entor your response rounded to two decimal places.) lo-2 3456 7890

The following table shows Farmer Parker's revenue, cost, and profit from wheat farming Quantity (bushels) (Q) Total Revenue Total Cost Marginal Revenue (MR) Marginal Cost (MC) Profit (TR-TC) $-3.00 -2.00 0.00 2.50 4.50 6.00 6.00 5.50 2.50 -3.00 (TR) $0.00 (TC) $3.00 6.00 8.00 9.50 11.50 1. 4.00 $4.00 3.00 8.00 12.00 16.00 20.00 4,00 2.00 3. 4.00 1.50 4.00 2.00 2.50 4.00 14.00 4.00 4.00 4.00 18.00 22.50 29.50 39.00 51.50 24.00 28.00 32.00 36.00 40.00 4.50 7.00 4.00 4.00 9.50 - 11.50 4.00 12.50 Farmer Parker's profit-maximizing level of production is 6 bushels of wheat. At this level of production he produces following the rule Marginal Revenue = Marginal Cost and earns the maximum possible profit of $6.00. Farmer Parker's fixed costs are $3. (Enter your responso rounded to two decimal places.) Suppose that foced costs increase by $1.50. Farmer Parker's new profit-maximizing level of production after the increase in fixed costs isbushels of wheat The amount of profit that Farmer Parker will eam after the increase in fixed costs is $ (Entor your response rounded to two decimal places.) lo-2 3456 7890

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter22: Getting Divisions To Work In The Firm’s Best Interests

Section: Chapter Questions

Problem 3MC

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