Question

3. The Pinnacle Pickles Company makes small-batch pickles from a special recipe. Its goal is to maximize profit. This year it is renting test kitchen space during pickling season at a fined cost (FC) of $1,800 per week, plus variable costs (VC) for labor and ingredients. Weekly output levels (Q, in jars) and associated VC appear below. [VC include returns on owner investment and management effort.) (31%) To lay the foundation for management decisions, please complete the table below by filling in unshaded cells with total cost (TC), average variable cost(AVC), and average total cost (ATC). Please also calculate unshaded values between output levels: incremental change in variable cost (AVC), incremental change in quantity (9), and marginal cost (MC) per jar of pickles (calculated from the incremental change numbers). Round AVC, ATC and MC values to two decimal places (cents). VCTC AVC ATC AVC AQ MC Q 0 $0 199 $700 627 $1,400 1,133 $2,100 1,561 $2,800 1,760 $3,500

Could you show me how number 3 is solved?

Answer 1

FC = 1800

TC = FC + VC

Q	VC($)	TC($)=1800+VC	AVC($)=VC/Q	ATC($)=TC/Q	∆VC	∆Q	MC($)=∆VC/∆Q
0	0	1800	--	--	--	--	--
199	700	2500	3.52	12.56	700.00	199.00	3.52
627	1400	3200	2.23	5.10	700.00	428.00	1.64
1133	2100	3900	1.85	3.44	700.00	506.00	1.38
1561	2800	4600	1.79	2.95	700.00	428.00	1.64
1760	3500	5300	1.99	3.01	700.00	199.00	3.52