Panther Acre Cattle Company - Chapter 7 Lab A typical farm or ranch problem is determining the optimum or profit-maximizing weight to sell fed cattle. Assume the feeder cattle are purchased at 600 pounds. The feed required and the weight gain is shown in the table below. Feed costs 7¢ per pound and feeder cattle prices are as follows: Weight go to 3rd deciment Price per Pound 600-899 lbs 72¢ 900-1099 lbs 70¢ 1100 lbs or more 67¢ Pay attention to the price changes when computing MVP. Input Output Feed Weight Selling Required Gain Weight Total Average Marginal Marginal Marginal Revenue Physical Physical Value Input (lbs) (lbs) (lbs) Product Product Product Cost 0 0 600 432 XXX 500 50 So 650 468 0.10 XXX 0.083 XXX XXX 1,100 145 as 745 536.40 0.132 6.158 1,700 235 ao 835 601.20 0.138 0.15 2,300 320 85 920 644 0.139 2,900 400 80 1,000 700 0.138 3,500 465 65 1,065 745. SO 0.133 4,100 525 60 1,125 753.75 0.128 4,700 575 SO 1,175 787.25 0.122 5,300 615 D 1,215 814.05 0.116 5,900 645 30 1,245 834.15 0.109 1. What is the profit-maximizing weight at which to sell fed cattle? 2. If feed costs 10¢ per pound, what would be the profit-maximizing weight? 3. How necessary was it to calculate APP to answer these questions?

Panther Acre Cattle Company - Chapter 7 Lab A typical farm or ranch problem is determining the optimum or profit-maximizing weight to sell fed cattle. Assume the feeder cattle are purchased at 600 pounds. The feed required and the weight gain is shown in the table below. Feed costs 7¢ per pound and feeder cattle prices are as follows: Weight go to 3rd deciment Price per Pound 600-899 lbs 72¢ 900-1099 lbs 70¢ 1100 lbs or more 67¢ Pay attention to the price changes when computing MVP. Input Output Feed Weight Selling Required Gain Weight Total Average Marginal Marginal Marginal Revenue Physical Physical Value Input (lbs) (lbs) (lbs) Product Product Product Cost 0 0 600 432 XXX 500 50 So 650 468 0.10 XXX 0.083 XXX XXX 1,100 145 as 745 536.40 0.132 6.158 1,700 235 ao 835 601.20 0.138 0.15 2,300 320 85 920 644 0.139 2,900 400 80 1,000 700 0.138 3,500 465 65 1,065 745. SO 0.133 4,100 525 60 1,125 753.75 0.128 4,700 575 SO 1,175 787.25 0.122 5,300 615 D 1,215 814.05 0.116 5,900 645 30 1,245 834.15 0.109 1. What is the profit-maximizing weight at which to sell fed cattle? 2. If feed costs 10¢ per pound, what would be the profit-maximizing weight? 3. How necessary was it to calculate APP to answer these questions?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Panther Acre Cattle Company - Chapter 7 Lab
A typical farm or ranch problem is determining the optimum or profit-maximizing weight to sell
fed cattle. Assume the feeder cattle are purchased at 600 pounds. The feed required and the
weight gain is shown in the table below. Feed costs 7¢ per pound and feeder cattle prices are as
follows:
Weight
Price per Pound
600-899 lbs
72¢
go to 3rd
900-1099 lbs
decimal
1100 lbs or more
70¢
Point
67¢
Pay attention to the price changes when computing MVP.
Input
Output
Feed
Weight
Selling
Required Gain
Weight
Total Average Marginal Marginal Marginal
Revenue Physical Physical Value
Input
(lbs)
(lbs)
(lbs)
Product
Product
Product
Cost
600
0
0
600
432
XXX
XXX
XXX
XXX
500
50 So
650
468
0.10
0.083
1,100
145 as
745
536.40 0.132
6.158
1,700
235 aol
835
601.20
0.138
0.15
2,300
320 85
920
644
0.139
2,900
400 80
1,000
700
0.138
3,500
465 65
1,065
745, 50 0.133
4,100
525 60
1,125
753.75 0.128
4,700
575 SO
1,175
787.25 0.122
5,300
615 40
1,215
814.05 0.116
5,900
645 30
1,245
834.15 0.109
1. What is the profit-maximizing weight at which to sell fed cattle?
2. If feed costs 10¢ per pound, what would be the profit-maximizing weight?
3. How necessary was it to calculate APP to answer these questions?

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