Suppose that Maria is starting a food ordering and delivery company. Customers order meals online. Employees prepare the meals and deliver them to customers. Maintenance of the online platform for ordering meals costs the company $5 per day. The company also rents space where orders are prepared. Rent costs $50 per day. To make the deliveries, the business also rents two delivery cars that cost $10 each per day. The costs of ingredients for preparing different numbers of meals are provided in the table below. Maria also has to hire between 0 and 10 workers (depending on the number of meals she chooses to make) to buy ingredients, prepare meals, and deliver the orders. She will pay each employee $120 per day. The first two columns of the table below show how many meals different number of workers can prepare and deliver. Price per meal $50 Workers Meals (Labor L) (Output Q) 0 1 2 3 4 5 6 7 8 9 10 0- 30 42 52 60 67 73 79 85 90 95 MPL 30 12 10 8 7 6 6 6 5 5 FC Cost of ingredients $10 $75 $100 $121 $138 $152 $165 $177 $189 $199 $210 VC TC AFC AVC ATC MC TR Profit Profit per meal d) Use Excel functions to complete the table by calculating FC, VC, TC, MC, AFC, AVC, TR, Profit, and Profit per meal for each level of output (number of meals). Graph AVC, ATC, and MC curves.

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### Starting a Food Ordering and Delivery Company: Understanding Costs and Profits

Maria is launching a food ordering and delivery business. Here's an overview of the business model and the associated costs:

1. **Online Orders and Delivery**: 
   - Customers place orders online. Employees prepare and deliver meals.
   
2. **Fixed and Variable Costs**: 
   - **Maintenance Cost**: $5 per day for the online platform.
   - **Rent**: $50 per day for space where meals are prepared.
   - **Delivery Cars**: $20 per day ($10 each for 2 cars).
   
3. **Labor Costs**:
   - Maria needs to hire between 0 to 10 workers based on meal orders.
   - Each worker earns $120 per day.

4. **Cost of Ingredients**:
   - Varies with the number of meals produced.

5. **Pricing**:
   - Meals are priced at $50 each.

### Table of Production and Costs

The table below outlines the production capacity and costs for varying numbers of workers:

| Workers (Labor L) | Meals (Output Q) | MPL | FC | Cost of Ingredients | VC | TC | AFC | AVC | ATC | MC | TR | Profit | Profit per Meal |
|-------------------|------------------|-----|----|---------------------|----|----|-----|-----|-----|----|----|--------|----------------|
| 0                 | 0                | -   | $10| -                   | -  | -  | -   | -   | -   | -  | -  | -      | -              |
| 1                 | 30               | 30  | $75| -                   | -  | -  | -   | -   | -   | -  | -  | -      | -              |
| 2                 | 42               | 12  | $100| -                  | -  | -  | -   | -   | -   | -  | -  | -      | -              |
| 3                 | 52               | 10  | $121| -                  | -  | -  | -   | -   | -   | -  | -  | -      | -              |
| 4                 | 60               | 8   | $138| -                  | -  | -  | -
Transcribed Image Text:### Starting a Food Ordering and Delivery Company: Understanding Costs and Profits Maria is launching a food ordering and delivery business. Here's an overview of the business model and the associated costs: 1. **Online Orders and Delivery**: - Customers place orders online. Employees prepare and deliver meals. 2. **Fixed and Variable Costs**: - **Maintenance Cost**: $5 per day for the online platform. - **Rent**: $50 per day for space where meals are prepared. - **Delivery Cars**: $20 per day ($10 each for 2 cars). 3. **Labor Costs**: - Maria needs to hire between 0 to 10 workers based on meal orders. - Each worker earns $120 per day. 4. **Cost of Ingredients**: - Varies with the number of meals produced. 5. **Pricing**: - Meals are priced at $50 each. ### Table of Production and Costs The table below outlines the production capacity and costs for varying numbers of workers: | Workers (Labor L) | Meals (Output Q) | MPL | FC | Cost of Ingredients | VC | TC | AFC | AVC | ATC | MC | TR | Profit | Profit per Meal | |-------------------|------------------|-----|----|---------------------|----|----|-----|-----|-----|----|----|--------|----------------| | 0 | 0 | - | $10| - | - | - | - | - | - | - | - | - | - | | 1 | 30 | 30 | $75| - | - | - | - | - | - | - | - | - | - | | 2 | 42 | 12 | $100| - | - | - | - | - | - | - | - | - | - | | 3 | 52 | 10 | $121| - | - | - | - | - | - | - | - | - | - | | 4 | 60 | 8 | $138| - | - | - | -
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