# The table below shows the daily costs of Corny's Corn Cobs. Corny's sells corn by the dozen in a perfectly competitive market. The market price of a dozen ears of corn is \$6.50 per dozen.

Anonymous
timer Asked: May 5th, 2020

### Question Description

The table below shows the daily costs of Corny's Corn Cobs. Corny's sells corn by the dozen in a perfectly competitive market. The market price of a dozen ears of corn is \$6.50 per dozen.

a. In the short run, to maximize profits how much corn should Corny's produce?

Instructions: Enter your answer as a whole number.

dozen ears of corn per day

b. If Corny's produces the profit-maximizing quantity of corn in the short run, what is Corny's profits or losses per day?

Instructions: Round your answer to 2 decimal places. Enter a loss as a negative (-) number.

\$

c. In the short run, assuming nothing else changes, Corny's should

• shut down, because the market price is above the AVC.
• produce a greater quantity of corn per day.
• produce a lower quantity of corn per day.
• produce the same quantity of corn per day.

d. If the short-run price of corn falls to \$4.30 per dozen, Corny's should

• produce a greater quantity of corn per day.
• produce a lower quantity of corn per day.
• produce the same quantity of corn per day.
• shut down, because the market price is below the AVC.

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