Jack sells water bottles. Assume the market for water bottles is perfectly competitive. Jack sells his water bottles at the market price of $9.00. At the profit-maximising output level of 51 water bottles, Jack's average total cost is $4.40 per water bottle. The minimum average variable cost is $3.90 per water bottle. Answer the following questions: a. Jack's economic profit or loss is decimal places (ie: to the nearest cent). (use a negative value if a loss). Answer in dollars, rounded to two b. State whether the following statement is true or false: "At the profit-maximising quantity, Jack is making an economic profit of $4.60 per water bottle." Type T for true, or F for false c. State whether the following statement is true or false: "Jack should shut down if the market price is $3.85 per water bottle." Type T for true, or F for false
Jack sells water bottles. Assume the market for water bottles is perfectly competitive. Jack sells his water bottles at the market price of $9.00. At the profit-maximising output level of 51 water bottles, Jack's average total cost is $4.40 per water bottle. The minimum average variable cost is $3.90 per water bottle. Answer the following questions: a. Jack's economic profit or loss is decimal places (ie: to the nearest cent). (use a negative value if a loss). Answer in dollars, rounded to two b. State whether the following statement is true or false: "At the profit-maximising quantity, Jack is making an economic profit of $4.60 per water bottle." Type T for true, or F for false c. State whether the following statement is true or false: "Jack should shut down if the market price is $3.85 per water bottle." Type T for true, or F for false
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![QUESTION 10
Jack sells water bottles. Assume the market for water bottles is perfectly competitive. Jack sells his water bottles at the market price of
$9.00. At the profit-maximising output level of 51 water bottles, Jack's average total cost is $4.40 per water bottle. The minimum average
variable cost is $3.90 per water bottle.
Answer the following questions:
a. Jack's economic profit or loss is
decimal places (ie: to the nearest cent).
(use a negative value if a loss). Answer in dollars, rounded to two
b. State whether the following statement is true or false: "At the profit-maximising quantity, Jack is making an economic profit of
$4.60 per water bottle." Type T for true, or F for false
c. State whether the following statement is true or false: "Jack should shut down if the market price is $3.85 per water bottle." Type T
for true, or F for false](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2d2c445a-1cdd-40e4-bca0-31427b8d1cda%2F921bfed7-6e45-45a5-83b5-c37893fdcae2%2Fa1rlys_processed.jpeg&w=3840&q=75)
Transcribed Image Text:QUESTION 10
Jack sells water bottles. Assume the market for water bottles is perfectly competitive. Jack sells his water bottles at the market price of
$9.00. At the profit-maximising output level of 51 water bottles, Jack's average total cost is $4.40 per water bottle. The minimum average
variable cost is $3.90 per water bottle.
Answer the following questions:
a. Jack's economic profit or loss is
decimal places (ie: to the nearest cent).
(use a negative value if a loss). Answer in dollars, rounded to two
b. State whether the following statement is true or false: "At the profit-maximising quantity, Jack is making an economic profit of
$4.60 per water bottle." Type T for true, or F for false
c. State whether the following statement is true or false: "Jack should shut down if the market price is $3.85 per water bottle." Type T
for true, or F for false
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 3 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
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.Recommended textbooks for you
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![Principles of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781305585126/9781305585126_smallCoverImage.gif)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Managerial Economics: A Problem Solving Approach](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
![Managerial Economics & Business Strategy (Mcgraw-…](https://www.bartleby.com/isbn_cover_images/9781259290619/9781259290619_smallCoverImage.gif)
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education