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Unformatted text preview: information published from LGU (Land grant universities) what is the price of x? (COULD BE ON THE TEST!) TAKE X/TVX = price TC = total variable cost + total fixed cost Average fixed cost average variable cost average total cost Marginal cost Profit maximizing decision rule Marginal revenue is just slightly greater than marginal cost marginal revenue should be equal or close to price of product Price of y = $4, you should produce somewhere between 230 and 240 bushels (look at the MR) if I maximize profit will minimize loses On the last page don’t worry about column six cost and revenue curves for the classice production function table max profit is where your total revenue and your total cost are furthest apart when the slopes of Marginal revenue and marginal costs are equal, that is your point of most efficient production profit is the area above the cost of production typically these cost curves are going to be U shaped because...
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- Spring '08
- Economics of production, Marginal cost profit, cost Marginal revenue