Question

Bob produces Blu-ray movies for sale, which requires a building and a machine that copies the original movie onto a Blu-ray. Bob rents a building for $30,000 per month and rents a machine or $20,000 a month. Those are his fixed costs. His variable cost (VC) per month is given in the accompanying table. Quantity of Blu-rays VC 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 ,000 10,000 s0 ,000 8,000 9,000 14,000 20,000 33,000 49,000 72,000 9,000 150,000

1. Draw Bob's marginal cost curve. In your graph, plot the price range from $0 to $60 in increments of $10.

2. Over what range of prices will Bob produce no Blu-rays in the short run?

3. Draw Bob's individual supply curve.

Answer 1

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