Suppose that an oligopolistic ally competitive restaurant is currently serving 230 meals per day (the output where MR = MC). At that output level, ATC per meal is $10 and consumers are willing to pay $12 per meal. What is the size of this firm

answer

watching

193

views

For unlimited access to Homework Help, a Homework+ subscription is required.

You have 0 free answers left.
Get unlimited access to 3.8 million step-by-step answers.

Get unlimited access

Already have an account? Log in

Chika IlonahLv10

28 Sep 2019

Unlock all answers

Get 1 free homework help answer.

Already have an account? Log in

Related questions

A person has a choice between eating meals at home and eating meals in a restaurant. The cost of the food that is eaten at home is $10 per meal. The cost of a restaurant meal is $20. It takes two hours to eat a meal at home. It takes one hour to eat a meal in a restaurant. The marginal utilities of the home meal and the restaurant meal are the same. The person values time at $12 per hour. What does the theory of consumer behavior suggest rational consumers will decide to do: eat at home or in a restaurant? Answer by first excluding the value of time from the decision, then include the value of time in the decision.

taneagle172

Kate's Katering provides catered meals, and the catered meals industry is perfectly competitive. Kate's machinery costs $100 per day and is the only fixed input. Her variable cost is comprised of the wages paid to the cooks and the food ingredients.

The variable cost associated with each level of output is given in the accompanying table.

Qty. of Meals || VC
0...............|| $0
10.............|| $200
20.............|| $300
30.............|| $480
40.............|| $700
50.............|| $1000

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

Quantity of meals || FC || VC || TC || MC || AVC || ATC
0.....................||$100 || $0
10....................||100 || 200
20....................||100 || 300
30....................||100 || 480
40....................||100 || 700
50....................||100 ||1,000

b. What is the break-even price?

What is a shut-down price?

c. Suppose that the price at which Kate can sell catered meals is$21 per meal. In the short run, will Kate earn a profit?

In the short run, should she produce or shut down?

d. Suppose that the price at which Kate can sell catered meals is$17 per meal. In the short run, will Kate earn a profit?

In the short run, should she produce or shut down?

e. Suppose that the price at which Kate can sell catered meals is$13 per meal. In the short run, will Kate earn a profit? In the short run, should she produce or shut down?