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Behind the Supply Curve: Inputs and Costs -- End of Chapter Problem Consider Daniella's concrete-mixing business described in Problem 12. Assume that Daniella purchased 3 trucks, expecting to produce 40 orders per week. Quantity of trucks VC FC 20 orders 40 orders 60 orders 2 $6,000 $2,000 55.000 $12,000 3 7.000 1.800 3,800 10,800 4 8,000 1,200 3.600 8.400 a. If business were to decline to 20 orders per week, Daniella's average total cost per order in the short run would be S460 - If her business were to boom to 60 orders per week, her average total short-run cost per order would be $270 b. At 20 orders per week, Daniella's average total cost per order in the long run would be $400. Daniella's short-run average total cost of producing 20 orders per weekwhen the number of trucks is fixed at 3-is greater than her long-run average total cost of producing 20 orders per week because in switching to a scale of operations, her fixed relative to her variable cost. cost c. In the diagram, plot Daniella's long-run average total cost curve (LRATC) and her short-run average total cost curve if she owns 3 trucks (ATC). LRATC 000 ATO 550 500 450 400 350 Cost 300 250 200 150 100 50 0 O 20 00 30 40 Number of orders Behind the Supply Curve: Inputs and Costs -- End of Chapter Problem Consider Daniella's concrete-mixing business described in Problem 12. Assume that Daniella purchased 3 trucks, expecting to produce 40 orders per week. Quantity of trucks VC FC 20 orders 40 orders 60 orders 2 $6,000 $2,000 55.000 $12,000 3 7.000 1.800 3,800 10,800 4 8,000 1,200 3.600 8.400 a. If business were to decline to 20 orders per week, Daniella's average total cost per order in the short run would be S460 - If her business were to boom to 60 orders per week, her average total short-run cost per order would be $270 b. At 20 orders per week, Daniella's average total cost per order in the long run would be $400. Daniella's short-run average total cost of producing 20 orders per weekwhen the number of trucks is fixed at 3-is greater than her long-run average total cost of producing 20 orders per week because in switching to a scale of operations, her fixed relative to her variable cost. cost c. In the diagram, plot Daniella's long-run average total cost curve (LRATC) and her short-run average total cost curve if she owns 3 trucks (ATC). LRATC 000 ATO 550 500 450 400 350 Cost 300 250 200 150 100 50 0 O 20 00 30 40 Number of orders

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