Trout farming is a perfectly competitive industry and all trout farms have the same cost curves. when the market price is $25 a fish, farms maximize profit by producing 200 fish a week. at this output, average total cost is $20 a fish and average variable cost is $15 a fish. minimum average variable cost is $12 a fish. i) If the price falls to $20 a fish, will a trout farm produce 200 fish a week. Explain why or why not ii) If the price falls to $12 a fish, what will the trout farmer do? iii) What are two points on a trout farm's supply curve?

Trout farming is a perfectly competitive industry and all trout farms have the same cost curves. when the market price is $25 a fish, farms maximize profit by producing 200 fish a week. at this output, average total cost is $20 a fish and average variable cost is $15 a fish. minimum average variable cost is $12 a fish. i) If the price falls to $20 a fish, will a trout farm produce 200 fish a week. Explain why or why not ii) If the price falls to $12 a fish, what will the trout farmer do? iii) What are two points on a trout farm's supply curve?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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