Suppose that in a competitive wheat market, the forces of supply and demand determine a price of $4 for a bushel of wheat. There are 50 farmers in this market, and each farmer produces 100 bushels of wheat at the market price in short-run equilibrium. Each farmer has an average total cost (ATC) of $3.25, and an average variable cost (AVC) of $2.25 at the output level of 100.
Assume that the short-run equilibrium looks like this for a typical farmer where Q* = 100. farmer

http://www.washburn.edu/sobu/rwalker/EC200/Problems/C8_4.gif

Determine the total revenue, total cost, and $ amount of profits for each farmer.

Answer rating: 100% (QA)

To determine the total revenue total cost and profit for each farmer we need to calculate the releva... View the full answer