5. With current technology, suppose a firm is producing 600 apple pies daily. Also assume that the least-cost combination of resources in producing those pies is 10 units of labor at $20 per unit, 7 units of land at $60 per unit, 4 units of capital at $40 per unit, and 3 units of entrepreneurial ability at $20 per unit. Assume the firm can sell these 600 pies at $2 per unit. a. What is the firm's total revenue? b. What is the firm's total cost? c. Calculate the firm's economic profit or loss? d. Will the firm continue to produce pies?

5. With current technology, suppose a firm is producing 600 apple pies daily. Also assume that the least-cost combination of resources in producing those pies is 10 units of labor at $20 per unit, 7 units of land at $60 per unit, 4 units of capital at $40 per unit, and 3 units of entrepreneurial ability at $20 per unit. Assume the firm can sell these 600 pies at $2 per unit. a. What is the firm's total revenue? b. What is the firm's total cost? c. Calculate the firm's economic profit or loss? d. Will the firm continue to produce pies?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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