Think Break 9

Think break 9

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Unformatted text preview: Think Break #9 (Review) Steers Beef MP VMP 0 10 20 30 40 50 60 70 80 90 100 0 72 7.2 148 7.6 225 7.7 295 7.0 360 6.5 420 6.0 475 5.5 525 5.0 570 4.5 610 4.0 450 405 360 648 684 693 630 How many steers should you stock if the expected selling price is $90/cwt and steers cost $495 each? Hint: What's the single input optimality condition? Think Break #9 Answer Steers Beef MP VMP 0 10 20 30 40 50 60 70 80 90 100 0 72 7.2 148 7.6 225 7.7 295 7.0 360 6.5 420 6.0 475 5.5 525 5.0 570 4.5 610 4.0 648 684 693 630 585 540 495 450 405 360 How many steers should you stock if the expected selling price is $90/cwt and steers cost $495 each? Answer: 70 steers, since an additional steer costs $495, which equals the value of the marginal product generated by the added steer (rx = VMPx)...
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This note was uploaded on 08/08/2008 for the course AAE 320 taught by Professor Mitchell during the Spring '08 term at Wisconsin.

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