cost 3· a. From Kate\'s variable cost (VC), tr accompanying table calculates Kat
ID: 1112334 • Letter: C
Question
cost 3· a. From Kate's variable cost (VC), tr accompanying table calculates Kate's TC), average variable cost (AVC), average total cost (ATC), and marpinal cost 100.000.00 0.0 000 15.00 30.00 2200 .50 b. Kate's beeak-even peice, the minimum average total cest, is $19.33, at an output e. When the peice is $21, Kate will make a profit the price is ahove her break-even d. When the price is $17, Kate wl incur a loss: the price is below her brrak-even quantity of 30 meals Kate's shut-down price, the minimum average varlable cost is $15, at an output of 20 meals price. And since the price is above her shut-down price, Kate should prodace In the short run, not shut down. price. Buit since the price is above her shut-down price, Kate should produce in the short run, not shut down. e. When the price is $13, Kate would incur a loss if she were to produce: the price is below her break-even price. And since the price is also below her shut-down price Kate should shut down in the short nunExplanation / Answer
Answer 3 A :
Answer b : Katte break even price is the price where the katte earn no profit or no loss in the business scanerio.They are able to cover average total cost.
$19.33 is the minimum price charged by the katte.
Katte shut down price is $15 at the output of 20 meals.
Answer c : Price is the $21, Kate will make a profit , is above her break even price and since the price is above shut down price , katte should produce in short run and not shut down.
Answer d : When the price is $17, Kate will incurred a loss, the price below her break even price. Since the price is above her shut down price. Kate should produced in the short run and not shut down.
Answer e : When the price is $13 Kate would incurred a loss if she were to produced a price below her break even price and since the price is also below her shut down price where kate should shut down in long run scanerio.
Qty VC FC TC MC of a meal AVC of a meal ATC 0 0 100 100 - - - 10 200 100 300 20 20 30 20 300 100 400 10 15 20 30 480 100 580 18 14 19.33 40 700 100 800 22 17.50 20 50 1000 100 1100 30 20 22.00Related Questions
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