Isabella grows pumpkins. Her average variable cost (AVC), average total cost (ATC), and marginal cost (MC) of production are illustrated in the figure to the right. Assume the market for pumpkins is perfectly competitive and that the market price is $9.00 per box. How many pumpkins should Isabella grow? Isabella should produce thousand boxes of pumpkins. (Enter your response as an integer value.) How would you characterize Isabella's profit? Isabella's profit is ▼ Price ($ per box) 10.00 9.00- 8.00- 7.00- 6.00- 5.00- 4.00- 3.00- 2.00- 1.00- 0.00+ 0 MC Quantity (boxes in thousands) ATC AVCQ
Isabella grows pumpkins. Her average variable cost (AVC), average total cost (ATC), and marginal cost (MC) of production are illustrated in the figure to the right. Assume the market for pumpkins is perfectly competitive and that the market price is $9.00 per box. How many pumpkins should Isabella grow? Isabella should produce thousand boxes of pumpkins. (Enter your response as an integer value.) How would you characterize Isabella's profit? Isabella's profit is ▼ Price ($ per box) 10.00 9.00- 8.00- 7.00- 6.00- 5.00- 4.00- 3.00- 2.00- 1.00- 0.00+ 0 MC Quantity (boxes in thousands) ATC AVCQ
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Isabella grows pumpkins. Her average variable cost (AVC), average total cost (ATC), and marginal cost (MC) of production are illustrated in the figure to the right.
Assume the market for pumpkins is perfectly competitive and that the market price is $9.00 per box.
How many pumpkins should Isabella grow?
Isabella should produce [ ] thousand boxes of pumpkins. (Enter your response as an integer value.)
How would you characterize Isabella's profit?
Isabella's profit is [ ].
**Graph Explanation:**
The graph on the right displays cost curves in relation to the price and quantity of pumpkin boxes.
- The vertical axis represents the Price ($ per box).
- The horizontal axis represents the Quantity (boxes in thousands).
Three cost curves are plotted on the graph:
1. **Marginal Cost (MC)**: This curve is upward sloping and intersects both the AVC and ATC curves, indicating the change in total cost with an additional unit of output.
2. **Average Total Cost (ATC)**: This curve is U-shaped and represents the total costs averaged over all units produced.
3. **Average Variable Cost (AVC)**: This curve is also U-shaped, lying below the ATC curve, representing the variable costs averaged over all units of production.
The market price line is at $9.00 per box, indicated by a horizontal line intersecting these curves.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fffdf6043-828c-4471-912c-c675122f5b54%2F2f0c724f-7872-4fc2-a6ba-6fcbdbf14d46%2Fhjhmbxq_processed.png&w=3840&q=75)
Transcribed Image Text:**Text Transcription:**
Isabella grows pumpkins. Her average variable cost (AVC), average total cost (ATC), and marginal cost (MC) of production are illustrated in the figure to the right.
Assume the market for pumpkins is perfectly competitive and that the market price is $9.00 per box.
How many pumpkins should Isabella grow?
Isabella should produce [ ] thousand boxes of pumpkins. (Enter your response as an integer value.)
How would you characterize Isabella's profit?
Isabella's profit is [ ].
**Graph Explanation:**
The graph on the right displays cost curves in relation to the price and quantity of pumpkin boxes.
- The vertical axis represents the Price ($ per box).
- The horizontal axis represents the Quantity (boxes in thousands).
Three cost curves are plotted on the graph:
1. **Marginal Cost (MC)**: This curve is upward sloping and intersects both the AVC and ATC curves, indicating the change in total cost with an additional unit of output.
2. **Average Total Cost (ATC)**: This curve is U-shaped and represents the total costs averaged over all units produced.
3. **Average Variable Cost (AVC)**: This curve is also U-shaped, lying below the ATC curve, representing the variable costs averaged over all units of production.
The market price line is at $9.00 per box, indicated by a horizontal line intersecting these curves.
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