Use the table of expected cost and revenue data for the Tuckers Tomato Farm below to answer the following question(s). The Tuckers produce tomatoes in a greenhouse and sell them wholesale in a competitive price-taker market.
Table 9-1
Refer to Table 9-1. If the market price of tomatoes rose to $570 per ton, how many tons per month would the Tuckers produce if they were maximizing profit?
A) 6
B) 7
C) 8
D) 9

Question

Use the table of expected cost and revenue data for the Tuckers Tomato Farm below to answer the following question(s). The Tuckers produce tomatoes in a greenhouse and sell them wholesale in a competitive price-taker market.
Table 9-1
 Refer to Table 9-1. If the market price of tomatoes rose to $570 per ton, how many tons per month would the Tuckers produce if they were maximizing profit?
A) 6 
B) 7 
C) 8 
D) 9

Quizplus · Accepted Answer

To maximize profit, the Tuckers should produce where marginal revenue (MR) equals marginal cost (MC). When the market price of tomatoes is $570 per ton, the MR is also $570. Looking at the table, when the Tuckers produce 8 tons per month, their MC is also $570. Therefore, the Tuckers should produce 8 tons per month to maximize profit.

Use the Table of Expected Cost and Revenue Data for the Tuckers