Answer:
Explanation:
Farmer:
Total cost of production of farmer = number of bushel × cost of per bushel
= 119 × $3
= $357
Total revenue of farmer = price × quantity sold
= $5 × 119
= $595
Total profit of farmer = Total revenue - Total cost
= 595 - 357
= 238
Firm F:
Total cost of production of firm F = pounds of flour × cost of per pound
= 51 × $6
= 306
Total revenue of firm F = price × quantity sold
= $10 × 45
= 450
Total profit of Firm F = Total revenue - Total cost
= 450 - 306
= 144
The total profit earned by the farmer and Firm F is $418.
The farmer's profit is $238 and Firm F's profit is $180.
Data and Calculations:
Number of bushels produced by farmer = 119
Cost per bushel = $3
Farmer's total cost= $357 (119 x $3)
Sales revenue for the farmer = $595 (119 x $5)
Profit earned by the farmer = $238 ($595 - $357)
Firm F's total cost of production = $306 (51 x $6)
Firm F's sales revenue = $450 (45 x $10)
Firm F's cost of sales = $270 (45 x $6)
Profit earned by Firm F = $180 ($450 - $270)
Thus, the addition of the two profits gives a total profit of $418.
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