You are managing a competitive corn farm that faces random demand. You must decide how much corn to produce before observing the actual price. As the2adjacent figure shows, the price will be $12 or $6 per bushel. The probability the price will be $12 isand the probability that the price will be $6 is -YourMC33$14marginal cost curve is also included in the figure.PH=MRH$12The quantity of corn that maximizes expected profit is bushels.$10(Carefully enter your response considering the units on the axes of the given figure.)S8The quantity you would produce if you knew the actual price was $12 isbushels.L= MRLThe quantity you would produce if you knew the actual price was $6 is bushels$6Suppose you produce the quantity of corn that maximizes expected profit, compared to what you would produce if you knew the actual price before producing.$4-The amount of profit lost if the actual price is $12 is $The amount of profit lost if the actual price is $6 is $(Enter a negative sign to indicate a loss.)10203050604070Quantity (thousands of bushels of corn per year)Price and cost (dollars per bushel of corn)

A competitive producer is optimizes its profit and output at the level where marginal cost is equal…

You are managing a competitive corn farm that faces random demand. You must decide how much corn to produce before observing the actual price As the adjacent figure shows, the price will be $12 or S6 per bushel. The probability the price will be $12 is and the probability that the price will be $6 is Your S14 marginal cost curve is also induded in the figure. E $12 The quantity of corm that maximizes expected profit is bushels. $10 (Carefully enter your response considering the units on the axes of the given figure.) The quantity you would produce if you knew the actual price was $12 is bushels The quantity you would produce if you knew the actual price was $6 is bushels Suppose you produce the quantity of corn that maximizes expected profit, compared to what you would produce if you knew the actual price before producing The amount of profit lost if the actual price is $12 is $ The amount of profit lost if the actual price is $6 is S (Enter a negative sign to indicate a loss.) 10 Quantity thou Price and cost (dolars per bushel of e

You are managing a competitive corn farm that faces random demand. You must decide how much corn to produce before observing the actual price As the adjacent figure shows, the price will be $12 or S6 per bushel. The probability the price will be $12 is and the probability that the price will be $6 is Your S14 marginal cost curve is also induded in the figure. E $12 The quantity of corm that maximizes expected profit is bushels. $10 (Carefully enter your response considering the units on the axes of the given figure.) The quantity you would produce if you knew the actual price was $12 is bushels The quantity you would produce if you knew the actual price was $6 is bushels Suppose you produce the quantity of corn that maximizes expected profit, compared to what you would produce if you knew the actual price before producing The amount of profit lost if the actual price is $12 is $ The amount of profit lost if the actual price is $6 is S (Enter a negative sign to indicate a loss.) 10 Quantity thou Price and cost (dolars per bushel of e

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter7: Uncertainty

Section: Chapter Questions

Problem 7.8P

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How would you find the probabilities for this question? (see attachment)
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