An oil refinery produces one base type of crude oil. The total cost is given by the equation Total Cost, TC = 50,000+20.2D +0.0001D2. The sales price in dollars per barrel is 35. At what level of production in barrels/week is cost/barrel minimum? What is the minimum cost per barrel? What is the maximum weekly profit that the company can make? At what level of production is the maximum weekly profit attainable?

An oil refinery produces one base type of crude oil. The total cost is given by the equation Total Cost, TC = 50,000+20.2D +0.0001D2. The sales price in dollars per barrel is 35. At what level of production in barrels/week is cost/barrel minimum? What is the minimum cost per barrel? What is the maximum weekly profit that the company can make? At what level of production is the maximum weekly profit attainable?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: Suppose that the cost function for a commodity is (x) = 90 + x? dollars. (a) Find the marginal cost…

A: Answer to the question is as follows :

Q: 12. Which one of the following statements is correct concerning the relationships among the firm's…

A: According to the given question Cost functions relationship in simple words we can say that is the…

Q: average total cost and what is the average variable cost I put what I thought the answers could be.

Q: Assume the cost of making 30 belts $800 the cost of makin 35 belts $900 and the cost equation is…

A: Marginal cost measures the change in total cost due to a change in quantity produced. Marginal cost…

Q: If the Marginal Cost for a product is found to be MC= 1500/15x+100' , and the cost of 80 units is…

A: We have, x= 80 Total cost = TC = $6000 at x = 80 Marginal cost, MC = 1500/ (15x+100) To find the…

Q: What is the price? to make it breakeven

A: Average cost is total cost divided by total production while marginal cost is the change in total…

Q: If fixed cost decreases to $16,000, does this change the production decision of the airline in the…

A: There are two types of costs, one is fixed and other is variable.Fixed cost does not depend on…

Q: Suppose that a company has determined that a 70% experience curve accurately describes the evolution…

A: Cost incurred to produce 1st unit = $200Experience Curve Percent = 70%Experience Curve suggests…

Q: The total cost function for a product is C(x) = 875 ln(x + 10) + 1600, where x is the number of…

A: The cost function calculates the lowest possible cost of manufacturing a specified quantity of…

Q: A company with two different plants manufactures guitars and banjos. Its production costs for each…

A: The cost of production of a firm involves costs of labor, raw materials, and capital. Out of the…

Q: C(x) = 60 + x² dollars. %3D (a) Find the marginal cost at x = 4 units. MC(4) = Tell what this…

A: Cost function alludes to the functional connection among cost and result. It concentrates on the way…

Q: A company manufactures and sells x cellphones per week. The weekly price-demand and cost equations…

A: Demand signifies the amount of a particular commodity or service that individuals are inclined to…

Q: K Drilling of an oil well has a fixed cost of $40,000 and a marginal cost of M'(x) = 5000+56x…

A: Marginal cost is the change in variable cost incurred to produce an additional unit of good.

Q: Night Shades. Incorporated, manufactures biotech sunglasses. The variable materials cost is $12.14…

A: Variable cost in economics means to expenses that vary with changes in the level of production or…

Q: TC = 217 + 55Q + 4Q2 What is the average variable cost when 10 units are produced? Enter as a valu

Q: The Cost and revenue funchon of a firm is given as /C=18+7Q+iOQ²+5Q3 and P = 1500Qt 3Q" ⑦Identify…

A: The cost function will include the fixed cost and variable costs. It will be shown as TC = FC + VC…

Q: The Mexican company generates a production per unit of time, each unit has a fixed cost of $40.00.…

A: Since you have posted a question with multiple sub parts, we will solve first three subparts for…

Q: Q.1) The Metal Works Inc. received an order for 500 metal gates. The fixed cost is assumed to be…

A: As per total revenue it is known to be as the value of the total receipts a seller in the market can…

Q: The marginal cost function for a company is given by C'(a) = q²-17q+70 dollars/unit, where q is the…

A: 1. Find the Total Cost Function:We are given the marginal cost function:C'(q) = q² - 17q + 70To find…

Q: Suppose that the total cost (in dollars) for a product is given by C(x)=1300+ 160 In(2x + 1) where x…

A: Given:Total cost: C (x) = 1,300 + 160ln(2x + 1) (a) MC = 320 / (2x + 1)Derive the MC from the total…

Q: Which cost concept helps firms assess the additional cost of producing one more unit beyond the…

A: In the field of financial aspects and business, understanding different cost ideas is essential for…

Q: 1. If the average cost of a plant to produce a "q" unit is explained by the functions below this: C…

A: Hi! Thank you for the question, As per the honor code, we are allowed to answer one question at a…

Q: Here is the production cost function, in $ of producing q units of a product: 2200 C(q) = 300 +0.8q2…

A: Since you have posted multiple questions with multiple subparts, as per guidelines, we are supposed…

Q: Ace Manufacturing produces 1,000 hammers per day. The total fixed cost for the plant is $5,000 per…

A: Average fixed cost is the fixed cost divided by units of output. Average variable cost is the total…

Question

show solution
An oil refinery produces one base type of crude oil. The total cost is given by the equation
Total Cost, TC = 50,000+20.2D +0.0001D2. The sales price in dollars per barrel is 35.
At what level of production in barrels/week is cost/barrel minimum?
What is the minimum cost per barrel?
What is the maximum weekly profit that the company can make?
At what level of production is the maximum weekly profit attainable?
and
Over what range of production is profit possible?
Express answers in whole numbers and write the numerical values only.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2 Part (a)

Step 3 Part (b)

Step 4 Part (c)

Step 5

Step by step

Solved in 5 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

If the accounting profit in an economy is $42 billion and the implicit cost is $29 billion find the economic profit.
There is economies of scale if the average cost of production is lower for bigger scale of operations compared to the average cost of production for smaller scale of operations True False
TC = 200 + 60Q + 2Q² What is the average variable cost when 4 units are produced? Enter as a value. 248
Craigsburg enterprises has a fixed cost of 10,000. It’s variable costs are shown in the table below. These costs remain unchanged as market prices change over the next few years:
Consider an airline's decision about whether to cancel a particular flight that hasn't sold out. The following table provides data on the total cost of operating a 100-seat plane for various numbers of passengers. Total Cost Number of Passengers (Dollars per flight) 40,000 10 60,000 20 65,000 30 68,000 40 70,000 50 71,000 60 72,500 70 73,500 80 74,000 90 74,300 100 74,500 Given the information presented in the previous table, the fixed cost to operate this flight is s At each ticket price, a different number of consumers will be willing to purchase tickets for this flight. Assume that the price of a flight is fixed for the duration of ticket sales. Use the previous table as well as the following demand schedule to complete the questions that follow. Price Quantity Demanded (Dollars per ticket) (Tickets per flight) 1,000 700 30 400 90 200 100
TC = 188 +38Q +4Q² What is the average fixed cost when 18 units are produced? Enter as a value. ROUND TO TWO DECIMAL PLACES.
Given Cost and Price (demand) functions C(q) = 110q + 45000 and p(q) = - 2.8q + 800, what profit can be earned if the price is set to be $550 per item? U The profit is $ 1,?9 (Round to the nearest cent.) A company produces a special new type of TV. The company has fixed costs of $499,000, and it costs STT00 to produce each TV. The company projects that if it charges a price of $2300 for the TV, it will be able to sell 850 TVs. If the company wants to sell 900 TVs, however, it must lower the price to $2000. Assumo a linear demand. What is the marginal profit if 200 TVs are produced It is $ 0 per item. (Round answer to nearest dollar.)
The total revenue function for a product is given by R=655x dollars, and the total cost function for this same product is given by C=19,250+70x+x2, where C is measured in dollars. For both functions, the input x is the number of units produced and sold. a. Form the profit function for this product from the two given functions. b. What is the profit when 25 units are produced and sold? c. What is the profit when 43 units are produced and sold?
A certain company has a selling price of for their product of 1500-3/4x dollars per unit and fixed costs of $800 and variable costs of 1/4x+1210 dollars per unit, where x is the total number of units produced. A.) FInd the Break even point? B.) When will the company make profit? C.) What is the make profit and the corresponding production level?
Which cost concept is used to determine the most cost-efficient level of production? a) Average cost b) Total cost c) Marginal cost d) Variable cost
Question 22
Suppose a company has fixed costs of $1500 and variable costs of (3/4)x + 1120 dollars per unit, where x is the total number of units produced. Suppose further that the selling price of its product is 1200 − (1/4)x dollars per unit. (a) Find the break-even points. (Enter your answers as a comma-separated list.)x = (b) Find the maximum revenue. (Round your answer to the nearest cent)$ (c) Form the profit function, P(x), from the cost and revenue functions.P(x) = Find maximum profit. (Round your answer to the nearest cent.)$ (d) What price will maximize the profit? (Round your answer to the nearest cent.)