Ali's Wheat Production Costs Quantity (bushels) AVC (dollars) ATC (dollars) MC (dollars) 0 — — — 500 $19.75 $34.75 $4.75 1,000 16.75 24.75 14.75 1,500 14.75 24.75 22.75 2,000 19.75 27.25 34.75 2,500 24.75 30.75 44.75 3,000 29.75 34.75 54.75 3,500 34.75 39.04 64.75 4,000 39.75 43.50 74.75 4,500 44.75 48.08 84.75 5,000 49.75 52.75 94.75 Round your answers to two decimal places. If you are entering a negative number include a minus sign. a. If the market price is $74.75 per bushel of wheat, and Ali chooses to produce wheat, how much will he produce per month to maximize his profits in the short run? bushels per month b. Calculate Ali’s monthly profits (express a loss as a negative number) if he chooses to produce the profit-maximizing quantity of wheat at a price of $74.75. $ c. Assume that the market price of wheat falls to $22.75 per bushel. How much wheat will Ali choose to produce per month in order to maximize his profits in the short run? bushels per month d. Calculate Ali’s monthly profits (express a loss as a negative number) if he chooses to produce the profit-maximizing quantity of wheat at a price of $22.75. $ e. If the market price of wheat instead falls to $14.75 per bushel, how much wheat will Ali choose to produce per month in order to maximize his profits in the short run? bushels per month
Ali's Wheat Production Costs
| Quantity (bushels) | MC (dollars) | ||
| 0 | — | — | — |
| 500 | $19.75 | $34.75 | $4.75 |
| 1,000 | 16.75 | 24.75 | 14.75 |
| 1,500 | 14.75 | 24.75 | 22.75 |
| 2,000 | 19.75 | 27.25 | 34.75 |
| 2,500 | 24.75 | 30.75 | 44.75 |
| 3,000 | 29.75 | 34.75 | 54.75 |
| 3,500 | 34.75 | 39.04 | 64.75 |
| 4,000 | 39.75 | 43.50 | 74.75 |
| 4,500 | 44.75 | 48.08 | 84.75 |
| 5,000 | 49.75 | 52.75 | 94.75 |
Round your answers to two decimal places. If you are entering a negative number include a minus sign.
a. If the market
bushels per month
b. Calculate Ali’s monthly
$
c. Assume that the market price of wheat falls to $22.75 per bushel. How much wheat will Ali choose to produce per month in order to maximize his profits in the short run?
bushels per month
d. Calculate Ali’s monthly profits (express a loss as a negative number) if he chooses to produce the profit-maximizing quantity of wheat at a price of $22.75.
$
e. If the market price of wheat instead falls to $14.75 per bushel, how much wheat will Ali choose to produce per month in order to maximize his profits in the short run?
bushels per month
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