Problem: Tinley Paper, Inc. produces uncoated paper used in a wide variety of industrial applications. Newsprint, a major product, is sold in a perfectly competitive market. The following relation exists between the firm's newsprint output and total production costs:
|
Total Output (tons)
|
Total Cost ($)
|
|
0
|
25
|
|
1
|
75
|
|
2
|
135
|
|
3
|
205
|
|
4
|
285
|
|
5
|
375
|
|
6
|
475
|
|
7
|
600
|
1. Construct a table showing Tinley's marginal cost of newsprint production.
2. What is the minimum price necessary for Tinley to supply 1 ton of newsprint?
3. How much newsprint would Tinley supply at industry prices of $75 and $100 Per ton?