Maria manages a bakery that specialises in ciabatta bread, and has the following information on demand and costs:Based on the available information, calculate total revenue, marginal cost and marginal revenue. Present all information in a table format (including the number of bread(s) sold per hour, price, total cost, total revenue, marginal cost and marginal revenue.To maximise profit, how many ciabatta breads should Maria sell per hour, what price should she charge, and how much profit will she make?What is the marginal revenue received by selling the profit-maximising quantity of ciabatta bread? What is the marginal cost of producing the profit-maximising quantity of ciabatta bread? CIABATTA BREAD SOLD PER PRICE (P)HOUR (Q)0$6.0015.5025.0034.5044.0053.5063.0072.5082.00+TOTAL COST (TC)$3.007.0010.0012.5014.5016.0017.0018.5021.00[+

Profit is maximized where marginal revenue equals marginal cost

Answered: Maria manages a bakery that specialises…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Maria manages a bakery that specialises in ciabatta bread, and has the following information on demand and costs:

Based on the available information, calculate total revenue, marginal cost and marginal revenue. Present all information in a table format (including the number of bread(s) sold per hour, price, total cost, total revenue, marginal cost and marginal revenue.
To maximise profit, how many ciabatta breads should Maria sell per hour, what price should she charge, and how much profit will she make?
What is the marginal revenue received by selling the profit-maximising quantity of ciabatta bread? What is the marginal cost of producing the profit-maximising quantity of ciabatta bread?

CIABATTA BREAD SOLD PER PRICE (P)
HOUR (Q)
0
$6.00
1
5.50
2
5.00
3
4.50
4
4.00
5
3.50
6
3.00
7
2.50
8
2.00
+
TOTAL COST (TC)
$3.00
7.00
10.00
12.50
14.50
16.00
17.00
18.50
21.00
[+

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