Atlanta's farmers grow peaches. Their production cost is $1.5 per pound of peach. Assume the transportation cost is $6.00 per ton per mile (one ton is 2000 lbs). Assume the consumers will pay up to $3.5/lb for Atlanta peaches. Several cities are in the farmer's potential market to sell peaches to.

(6a) What it the farthest city (in this table) can Atlanta peach farmers sell their peaches and still make profits?

City	Distance (miles)
Memphis, TN	400
Orlando, FL	440
Cincinnati, OH	465
Washington DC	650
Chicago, IL	720
New York, NY	880

(6b) Due to lack of truck drivers, the transportation cost now is $8.00 per ton per mile, that is the further city that the new transportation cost can take Atlanta's farmer to sell their peaches and still make profits.

(6c) If Atlanta's farmers will not sell peaches at loss, what is the minimal willingness-to-pay of New Yorker consumers so they can enjoy Atlanta's peaches?

Answer rating: 100% (QA)

City Distance miles selling Pricelb Production cost Fixed per pound Transportation cost per ton per ... View the full answer