Exhibit 6-11 Short-run cost schedule for pizzeria's hourly production $$\begin{array} { | c | r | }
\hline \begin{array} { c }
\text { Total } \
\text { Product }
\end{array} & \begin{array} { r }
\text { Total } \
\text { Cost }
\end{array} \
\hline 0 \text { pizzas } & \$ 20 \
10 & 70 \
20 & 100 \
30 & 150 \
40 & 250 \
\hline
\end{array}$$ In Exhibit 6-11, the marginal cost curve crosses the average total cost curve at

Question

Exhibit 6-11 Short-run cost schedule for pizzeria's hourly production $$\begin{array} { | c | r | } 
\hline \begin{array} { c } 
\text { Total } \
\text { Product }
\end{array} & \begin{array} { r } 
\text { Total } \
\text { Cost }
\end{array} \
\hline 0 \text { pizzas } & \$ 20 \
10 & 70 \
20 & 100 \
30 & 150 \
40 & 250 \
\hline
\end{array}$$ In Exhibit 6-11, the marginal cost curve crosses the average total cost curve at

Quizplus · Accepted Answer

The marginal cost curve crosses the average total cost curve at the minimum point of the average total cost. To find this, calculate the average total cost (ATC) for each level of output and identify where the marginal cost (change in total cost with one additional unit of output) equals the ATC. The ATC decreases as output increases from 10 to 30 pizzas, indicating efficiency gains. At 30 pizzas, the ATC starts to increase, suggesting this is where MC meets ATC at its lowest point.

Exhibit 6-11 Short-Run Cost Schedule for Pizzeria's Hourly Production In Exhibit 6-11, the Marginal Cost Curve Crosses the Average