15.1 A Firm's Profit-Maximizing Choices.docx - Walt's Turkey Farm produced 1,200 turkeys last week The marginal cost was $31 a turkey average variable

15.1 A Firm's Profit-Maximizing Choices.docx - Walt's...

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Walt's Turkey Farm produced 1,200 turkeys last week. The marginal cost was $31 a turkey, average variable cost was $21 a turkey, and the market price was $26 a turkey. Walt is ______ profit, so if nothing changes he will ______ the number of turkeys he produces to maximize his profit this week. not maximizing ; decrease Vito's Salmon Farm produced 1 comma 100 fish last week. The marginal cost was $6 a fish, average variable cost was $19 a fish, and the market price was $21 a fish. Vito is ______ profit, so if nothing changes he will ______ the number of fish he produces to maximize his profit this week. not maximizing ; increase Rabbit farming is a perfectly competitive industry and all rabbit farms have the same cost curves. When the market price is $22 a rabbit, farms maximize profit by producing 800 rabbits a week. At this output, average total cost is $20 and average variable cost is $14 a rabbit. Minimum average variable cost is $10 a rabbit. If the price falls to $20 a rabbit, a rabbit farm will ______. produce fewer than 800 rabbits a week Turkey farming is a perfectly competitive industry and all turkey farms have the same cost curves.
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