Farmer Brown grows cotton. The average total cost and marginal cost of growing cotton for an individual farmer are illustrated in the graph to the right. Assume the market for cotton is perfectly competitive and that the market price is $22 per bushel. Also assume that farmer Brown is producing the amount of cotton that maximizes profits. Use the rectangle drawing tool to shade in farmer Brown's profit. Properly label this shaded area. Carefully follow the instructions above, and only draw the required objects. Price and cost (dollars per bushel) 48- 44- 40- 36- 32 ATC 28- 24- 20- 16- 12- 8- 4- MC Price 0 10 20 30 40 50 60 70 80 90 100 Quantity of cotton (bushels per month in 1000s)

Farmer Brown grows cotton. The average total cost and marginal cost of growing cotton for an individual farmer are illustrated in the graph to the right. Assume the market for cotton is perfectly competitive and that the market price is $22 per bushel. Also assume that farmer Brown is producing the amount of cotton that maximizes profits. Use the rectangle drawing tool to shade in farmer Brown's profit. Properly label this shaded area. Carefully follow the instructions above, and only draw the required objects. Price and cost (dollars per bushel) 48- 44- 40- 36- 32 ATC 28- 24- 20- 16- 12- 8- 4- MC Price 0 10 20 30 40 50 60 70 80 90 100 Quantity of cotton (bushels per month in 1000s)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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