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Q. Mary's Fence Post Factory faces a perfectly elastic demand curve for fence posts at a price of $39 per post. Let Q represent the number of fence posts that Mary makes. What are Mary's total costs and marginal cost curves for making fence posts?
TC = 4,000 + 3Q + 0.1Q2MC = 3 + 0.2Q
Graph Mary's marginal cost curve using the orange line (square points) and her marginal revenue curve using the blue line (circle points). Place a green point (triangle symbol) at the price and quantity at which Mary would maximize short-run profits.
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