Table: Cakes Number of mixers 1 2 01 Fixed Costs 2 $1,000 1,500 2,500 Use Table: Cakes. Pat is opening a bakery to make and sell special birthday cakes. She is trying to decide how many mixers to purchase. Her estimated fixed and average variable costs if she purchases 1, 2, or 3 mixers are shown in the table. Assume that average variable costs do not vary with the quantity of output. How many mixers should Pat buy to get the lowest average total cost if she plans to make 100 cakes? Average Variable Cost $10

Table: Cakes Number of mixers 1 2 01 Fixed Costs 2 $1,000 1,500 2,500 Use Table: Cakes. Pat is opening a bakery to make and sell special birthday cakes. She is trying to decide how many mixers to purchase. Her estimated fixed and average variable costs if she purchases 1, 2, or 3 mixers are shown in the table. Assume that average variable costs do not vary with the quantity of output. How many mixers should Pat buy to get the lowest average total cost if she plans to make 100 cakes? Average Variable Cost $10

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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