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Maggie wants to open a flower shop in Easton. She has a choice of three different floor sizes: 200 sq. feet, 500 sq. feet, and
Maggie wants to open a flower shop in Easton. She has a choice of three different floor sizes: 200 sq. feet, 500 sq. feet, and 1000 sq. feet. The monthly rent is $1 per sq. foot. Maggie estimates that if she has F sq. feet of floor space and sells y bouquets a month, her variable cost will be c vy y2 F . Note: Given that variable cost is c vy y2 F , the marginal cost is MC Fy 2y F for some F. (a) What is Maggie's marginal cost of a bouquet, if she has 200 sq. feet of floor space, MC200y? (b) What is Maggie's average cost of a bouquet, if she has 200 sq. feet of floor space, AC 200 y? (c) At what level of output the average cost achieves minimum (find y 200 )? (d) What is the average cost of a bouquet at y 200 ? (e) What is Maggie's marginal cost of a bouquet, if she has 500 sq. feet of floor space, MC 500 y? (f) What is Maggie's average cost of a bouquet, if she has 500 sq. feet of floor space, AC 500 y? (g) At what level
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