from the origin to a quantity of 75, up to point E, over to the vertical axis and down to the origin. It should be

clear that the rectangles for total revenue and total cost are the same. Thus, the firm is making zero profit. The

calculations are as follows:

Or, we can calculate it as:

In Figure 8.5 (c), the market price has fallen still further to $2.00 for a pack of frozen raspberries. At this price,

marginal revenue intersects marginal cost at a quantity of 65. The farm’s total revenue at this price will be

shown by the large shaded rectangle from the origin over to a quantity of 65 packs (the base) up to point E” (the

height), over to the price of $2, and back to the origin. The average cost of producing 65 packs is shown by

Point C” or shows the average cost of producing 50 packs is about $2.73. Total costs will be the quantity of 65

times the average cost of $2.73, which the area of the rectangle from the origin to a quantity of 50, up to point
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