The Al-Maskri Company in Seeb makes flower pots and receives RO 10 for each finished pot. Mr. Al-Maskri’s only factors of production are flower pot machine operators (labor) and a small building where the laborers work from. The number of flower pots per day the company produces depends on the number of employee-hours per day as shown below. The wage is RO 15 per hour. Number of pots per day Number of employee-hours per day0051102154207251130163522 Al-Maskri’s daily fixed cost for the flower pot making machine and building is RO 60. Complete the following Table showing total revenue, variable cost, total cost, and daily profit for various quantities of daily flower pot production. Quantity ofPots per dayTotal RevenueRO per dayVariable CostsRO per dayTotal CostsRO per dayProfitRO per day00060-605 75-2510 15 20 105 25 30300 35 -40 The profit maximizing quantity of pots is __________ and at that number of pots the daily profit made is RO ________________________.

The revenue earned from the sale of each flower pot is RO 10 and the only factor of production is…

Answered: The Al-Maskri Company in Seeb makes…

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter4: Extent (how Much) Decisions

Section: Chapter Questions

Problem 3MC

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The Al-Maskri Company in Seeb makes flower pots and receives RO 10 for each finished pot. Mr. Al-Maskri’s only factors of production are flower pot machine operators (labor) and a small building where the laborers work from. The number of flower pots per day the company produces depends on the number of employee-hours per day as shown below. The wage is RO 15 per hour.

Number of pots per day	Number of employee-hours per day
0	0
5	1
10	2
15	4
20	7
25	11
30	16
35	22

Al-Maskri’s daily fixed cost for the flower pot making machine and building is RO 60. Complete the following Table showing total revenue, variable cost, total cost, and daily profit for various quantities of daily flower pot production.

Quantity of Pots per day	Total Revenue RO per day	Variable Costs RO per day	Total Costs RO per day	Profit RO per day
0	0	0	60	-60
5			75	-25
10
15
20		105
25
30	300
35				-40

The profit maximizing quantity of pots is __________ and at that number of pots the daily profit made is RO ________________________.

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