Consider the following table regarding the production of Blue Mountain Jamaican coffee.

2. Consider the following table regarding the production of Blue Mountain Jamaican coffee.

Output

(cases)

Total Fixed

Costs ($)

Total Variable

Costs ($)

Total

Costs ($)

Average Fixed

Cost ($/case)

Average

Variable Cost

($/case)

Average Total

Cost ($/case)

Marginal Cost

($/case)

1 150 30

2 50

3 60

4 64

5 90

6 125

7 173

8 238

a) Fill in the missing columns. (6 marks)

b) At what level of output does this coffee plantation experience increasing marginal costs? (1 mark)

c) At what level of output does this coffee plantation experience increasing average total costs? (1 mark)

d) What is the plantation’s shutdown price? Explain. (2 mark

 
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