$$\begin{array}{l}
\begin{array} { c | c }
\begin{array} { c }
\text { Output } \
\text { (Bushels of } \
\text { Barley) }
\end{array} & \begin{array} { c }
\text { Marginal } \
\text { Cost } \
\text { (Dollars) }
\end{array} \
\hline 10 \text { bushels } & \$ 0.30 \
20 \text { bushels } & \$ 0.60 \
30 \text { bushels } & \$ 0.90 \
40 \text { bushels } & \$ 1.20
\end{array}\
\text { Table } 5.1
\end{array}$$ Refer to Table 5.1,which gives Farmer McColl's marginal cost function for barley.Suppose Farmer McColl is one of 20 farmers in the barley market,and all of the farmers have identical marginal cost functions.If the market price of barley is $1.00 per bushel,which of the following could be the total amount of barley produced in the market?

Question

$$\begin{array}{l}
\begin{array} { c | c } 
\begin{array} { c } 
\text { Output } \
\text { (Bushels of } \
\text { Barley) }
\end{array} & \begin{array} { c } 
\text { Marginal } \
\text { Cost } \
\text { (Dollars) }
\end{array} \
\hline 10 \text { bushels } & \$ 0.30 \
20 \text { bushels } & \$ 0.60 \
30 \text { bushels } & \$ 0.90 \
40 \text { bushels } & \$ 1.20
\end{array}\
\text { Table } 5.1
\end{array}$$ Refer to Table 5.1,which gives Farmer McColl's marginal cost function for barley.Suppose Farmer McColl is one of 20 farmers in the barley market,and all of the farmers have identical marginal cost functions.If the market price of barley is $1.00 per bushel,which of the following could be the total amount of barley produced in the market?

Quizplus · Accepted Answer

The marginal cost of producing the 30th bushel is $0.90, which is less than the market price of $1.00. Therefore, each farmer will produce at least 30 bushels. Since there are 20 farmers, the total amount of barley produced in the market could be at least 20 * 30 = 600 bushels.