suppose in the short run the amount of machines she has is fixed at 27. How many mixers should she use? How many baklavas will she produce? How much profit will she make? b) using an isoprofit line, as well as the production function, draw a diagram of your solution from a). Carefully label all the slopes and intercepts. c) In the long run, how many mixers should she use? How many machines? How many baklavas will she make?

Explicit cost is = $900 Implicit cost = $333 Find the economic profit???

Month (m):           4                                              Day (d):  1 Use the two numbers above, m and d, to complete the cost function for a perfectly competitive firm: Cost (q) = m q2 + d =                                                                   (30) For a cost function like yours, Marginal Cost (MC) = 2 m q . Specifically, what are the following for the cost function you wrote out above? Fixed Cost = Average Total Cost = Cost (q)/q = Variable Cost = Average Fixed Cost = FC/q = Marginal Cost = 2 m q = Average Variable Cost = VC/q = (15) Fill in the table with your values from your cost function. q Total Cost AVC AFC ATC MC 0 0 0 -- -- -- 1           2           3           4           5           6

“A firm that earns only normal profit is not covering all its costs.” Do you agree or disagree?