Profit

Question 1

Using this table, calculate the marginal cost of each of these quantities of bikes. The first bike: $ The fourth bike: $ The sixth bike: $ The seventh bike: $

Revolt · Accepted Answer

Part 1: 80; Part 2: 20; Part 3: 50; Part 4: 60

Question 2

This graph shows the marginal cost of producing each bike. Select the correct answer from the options available.Based on this graph, which bike has a marginal cost of $20?

Revolt · Accepted Answer

Bike 4

Question 3

Using this table, calculate the profit at each level of bicycle production. One bike: -$ Two bikes: $ Three bikes: $ Four bikes: $ Five bikes: $ Six bikes: $ Seven bikes: $

Revolt · Accepted Answer

Part 1: 30; Part 2: 3; Part 3: 40; Part 4: 70; Part 5: 90; Part 6: 90; Part 7: 80

Question 4

This graph shows the marginal costs of each bike, along with the market price. Select the correct answer from the options available.Based on this graph, at which level of production does the producer’s profit stop increasing?

Revolt · Accepted Answer

bike 6

Question 5

Write three to five sentences explaining which levels of production provide Alonzo’s Cycling with the maximum profit.

Revolt · Accepted Answer

The maximum profit is $90, which occurs when Alonzo’s Cycling produces either 5 or 6 bikes per day. At 5 bikes, the company earns $250 in revenue and has costs of $160. At 6 bikes, it earns $300 in revenue and has costs of $210. Producing 7 bikes lowers the profit to $80, so producing 5 or 6 bikes is best.

Question 6

Which of these arguments did you include in your response? Check all that apply.

Revolt · Accepted Answer

Profit is maximized when marginal revenue equals marginal cost.; Profit is maximized when five or six bikes are made each day.; Profit declines when more than six bikes are produced each day.

Profit Answers

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