Question

Suppose that you are a manager of a firm like Sproule​ Farms, a perfectly competitive grower of sugar beets. The market price of sugar beets is ​$50 per ton. The table below has your cost per ton.

Quantity (Tons)	Total Cost $
5000	235,510
5001	235,550
5002	235,600
5003	235,651
5004	235,703
5005	235,756

The​ profit-maximizing quantity of sugar beets is ______ tons.

At the​ profit-maximizing quantity your economic profit or loss is $ _______.

Answer 1

Q=5002 and Profit=$14500

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MC(n)=(TC(n)-TC(p))/(n-p)
MC(n)=marginal cost of n th unit
TC(n)=Total cost of n units of output
TC(p)=Total cost of p unit of output
here, n>p.
MC(5001)=(235550-235510)/(5001-5000)

=$40and so on

the firm maximizes profit at MC=P

where

Q=5002

Profit=TR-TC

TR=P*Q=5002*50=250100

Profit=250100-235600

=14500

the profit is $14500

Q	TC	MC	TR	Profit
5000	235510		250000	14490
5001	235550	40	250050	14500
5002	235600	50	250100	14500
5003	235651	51	250150	14499
5004	235703	52	250200	14497
5005	235756	53	250250	14494