Mariam's Kitchen offers catered meals in a perfectly competitive industry. Mariam's machinery costs $100 per day and is the only fixed input. Her variable cost includes the wages paid to the chefs and the food ingredients. The variable cost per day for each level of output is given in the table below Quantity of Meals 0 28888 10 20 30 40 50 VC 0 200 300 480 700 1000 TC AVC (a) Calculate Total cost, Average variable cost and marginal cost (b) Determine the break-even price? What is the shut-down price? (c) If Market price is $21, will Mariam earn profit or loss? ATC MC
Mariam's Kitchen offers catered meals in a perfectly competitive industry. Mariam's machinery costs $100 per day and is the only fixed input. Her variable cost includes the wages paid to the chefs and the food ingredients. The variable cost per day for each level of output is given in the table below Quantity of Meals 0 28888 10 20 30 40 50 VC 0 200 300 480 700 1000 TC AVC (a) Calculate Total cost, Average variable cost and marginal cost (b) Determine the break-even price? What is the shut-down price? (c) If Market price is $21, will Mariam earn profit or loss? ATC MC
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter12: The Cost Of Production
Section: Chapter Questions
Problem 3CQQ
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