Profit

Question 1

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 2

Using this table, calculate the marginal cost of each of these quantities of bikes.

Revolt · Accepted Answer

80; 20; 50; 60

Question 3

One bike: -$[___]

Revolt · Accepted Answer

-: 30; 3; 40; 70; 90; 80; 30

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.

Profit Answers

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