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Ball Bearings, Inc., faces costs of production as follows:Quantity Total Fixed Costs (Dollars) Total Variable Costs (Dollars)0 100 01 100 502 100 703 100 904 100 1405 100 2006 100 360(a.) Complete the following table by calculating the company's total cost, marginal cost, average fixed cost, average variable cost, and average total cost at each level of production.
Ball Bearings, Inc., faces costs of production as follows:Quantity Total Fixed Costs (Dollars) Total Variable Costs (Dollars)0 100 01 100 502 100 703 100 904 100 1405 100 2006 100 360(a.) Complete the following table by calculating the company's total cost, marginal cost, average fixed cost, average variable cost, and average total cost at each level of production.(b.) The price of a case of ball bearings is $50. Seeing that he can't make a profit, the company's chief executive officer (CEO) decides to shut down operations.The firm's profit in this case is...(c.) True or False: This was a wise decision.(d.) Vaguely remembering his introductory economics course, the company's chief financial officer tells the CEO it is better to produce 1 case of ball bearings, because marginal revenue equals marginal cost at that quantity.At this level of production, the firm's profit is...True or False: This is the best decision the firm can make.
Final answer:The total cost,marginal cost, and average costs can be calculated using the given values of fixed and variable costs. The profit made by the company depends on the price of ball bearings. Whether shutting down operations or producing one case of ball bearings is a wise decision depends on the costs of production and the selling price.Explanation:The total cost at each level of production can be calculated by adding the totalfixed coststo the total variable costs. For example, at 1 quantity, the total cost would be 100 (fixed costs) + 50 (variable costs) = 150 dollars.The marginal cost is calculated as the change in total cost divided by the change in quantity. For instance, the marginal cost from producing 1 to 2 ball bearings would be (170-150)/1 = 20 dollars. The average fixed cost, average variable cost, and average total cost are then computed by dividing the fixed costs, variable costs, and total costs by the quantity, respectively.As per part b, if the price of a case of ball bearings is $50 and the CEO decides to shut down operations, the firm's profit would be $0, as no revenue is generated.For part c, whether the decision is wise or not depends on the circumstances. If the total cost of production exceeds the revenue gained from selling the ball bearings, it might be a wise decision. However, this might not be the case in the long-term if the variable costs decrease or the price of a case of bearings increases.Concerning part d, if the marginalrevenueequals the marginal cost at 1 case of ball bearings, the firm's profit would be the total revenue minus the total cost. If the cost to produce 1 case is less than or equal to $50, then the CFO is correct. Otherwise, it might not be the best decision.Learn more about Cost Analysis here:brainly.com/question/32631832#SPJ12...