6.  Utilizing the chicken wing production function that we completed in the Unit 2 homework assignment which would have the...

6.  Utilizing the chicken wing production function that we completed in the Unit 2 homework assignment which would have the following answers, respond to the questions given, assuming the firm is a perfectly competitive firm:

(8 points)

Input

(Hours)Output

(Wings)

MPP

TFC

TVC

TC

AFC

AVC

ATC

MC   

25118250212.50462.502.11.83.9   

6.71.3   

35185250297.50547.501.41.63.0   

5.71.5   

45242250382.50632.501.01.62.6   

5.11.7     

55293250467.50717.500.91.62.4   

3.82.2   

65331250552.50802.500.81.72.4   

2.92.9   

75360250637.50887.500.71.82.5 

A) Assume that the selling price for chicken wings is $2.50.  What would be the profit maximizing rate of output?

B)  Would the firm be generating profit above all costs at that selling price?

C)  If the price of chicken wings drops to $2.00, how many chicken wings should be produced then?  Are you making profit above all costs at $2 chicken wings?

D)  At what price would be the short-run breakeven point?  At what price should the firm shut down?