A new production technology for making vitamins is Invented by a college profess

Question

A new production technology for making vitamins is Invented by a college professor who decides not to patent i. Thus, it is available for anybody to copy and put into use. The TC per bottle for production up to 100,000 bottles per day is given in the following table. Instructions: In part a, enter your responses in the gray-shaded cells and round your answers to 2 decimal places. In parts c and d, enter your answers as whole numbers. a.What is ATC for each level of output listed in the table? ATC 25,000.00 S 50,00000 75,000.00 100,000.00 50,000.00r 70,000.00 s 75,000.00 80,000.00 $ above 100,000 bottles per day. TC Increases by $6,000 (s0 that, for instance, 125,000 bottes per day would generate tota Is this a decreasing-cost industry? Yes c.Suppose that the price of a botie of vitamins is $1.33 and that at that price ne trai quantity manded How many frms will there be in this industry d. Revlew your answers to parts b and c. Does the level of demand determine this industry's market structure? (No by consumers is 75,000,000 bottles 1 frm(s).

Explanation / Answer

c. 1 firms since this is a decreasing cost industry where a natural monopoly firm exists.

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