a. The total cost, the average variable cost , the average total cost , and the marginal cost for each quantity of output b. The break-even price and the shut-down price. c. If the price at which Kate can sell catered meals is $21 per meal, will she earn a profit in the short run and whether she should produce or shut down? d. If the price at which Kate can sell catered meals is $17 per meal, will she earn a profit in the short run and whether she should produce or shut down? e. If the price at which Kate can sell catered meals is $13 per meal will she earn a profit in the short run and whether she should produce or shut down? Concept Introduction: Marginal Cost - It is the cost of producing an additional unit of output. Average Variable cost - It is the firm’s variable cost that is expressed in terms of a unit. Average Total Cost - It is the firm’s total cost that is expressed in terms of each unit. Demand - It is the quantity of a commodity that a consumer is willing to purchase at a particular price in a given period of time.

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Chapter 12, Problem 13P

To determine

a. The total cost, the average variable cost, the average total cost, and the marginal cost for each quantity of output

b. The break-even price and the shut-down price.

c. If the price at which Kate can sell catered meals is $21 per meal, will she earn a profit in the short run and whether she should produce or shut down?

d. If the price at which Kate can sell catered meals is $17 per meal, will she earn a profit in the short run and whether she should produce or shut down?

e. If the price at which Kate can sell catered meals is $13 per meal will she earn a profit in the short run and whether she should produce or shut down?

Concept Introduction:

Marginal Cost - It is the cost of producing an additional unit of output.

Average Variable cost - It is the firm’s variable cost that is expressed in terms of a unit.

Average Total Cost - It is the firm’s total cost that is expressed in terms of each unit.

Demand - It is the quantity of a commodity that a consumer is willing to purchase at a particular price in a given period of time.

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