Next Friday, you plan to sell cakes at a bake sale to raise money for your school. You plan to charge $30 per cake, and you anticipate that you will sell 10 cakes. You can either purchase cakes to sell or bake them yourself. If you purchase the cakes, they will cost $21 each. If you bake your own cakes, your cost depends upon the number of cakes you bake, as shown in the table below. Number of cakes you bakeTotal cost of baked cakes ($)0011022233645257069071128136916210190 a) How many cakes should you bake? How many cakes should you purchase? Bake cake(s) purchase cake(s). b) Given your answer to part a, how much in total will the 10 cakes cost you? $ c) How much would it have cost you to bake all 10 cakes? $ d) How much would it have cost you to purchase all 10 cakes? $

a) The Marginal cost(MC) of producing the sixth cake is $20 and the MC of producing the seventh cake…

Answered: Next Friday, you plan to sell cakes at…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Next Friday, you plan to sell cakes at a bake sale to raise money for your school. You plan to charge $30 per cake, and you anticipate that you will sell 10 cakes. You can either purchase cakes to sell or bake them yourself. If you purchase the cakes, they will cost $21 each. If you bake your own cakes, your cost depends upon the number of cakes you bake, as shown in the table below.

Number of cakes you bake	Total cost of baked cakes ($)
0	0
1	10
2	22
3	36
4	52
5	70
6	90
7	112
8	136
9	162
10	190

a) How many cakes should you bake? How many cakes should you purchase?

Bake cake(s) purchase cake(s).

b) Given your answer to part a, how much in total will the 10 cakes cost you?

c) How much would it have cost you to bake all 10 cakes?

d) How much would it have cost you to purchase all 10 cakes?

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