7. A 200-pound steer can be sustained on a diet calling for various proportions of grass and grain. These combinations are shown in the table. Pounds of Grass 50 56 60 68 80 88 Pounds of Grain 80 70 65 60 54 52 a. Plot the isoquant corresponding to the inputs necessary to sustain a 200-pound steer. Comment on its shape. b. The rancher's cost of grass is $.10 per pound; the cost of grain is $.07 per pound. He prefers a feed mix of 68 pounds of grass and 60 pounds of grain. Is this a least-cost mix? If not, what is? Explain. c. The rancher believes there are constant returns to scale in fattening cattle. At current feed prices, what input quantities should he choose if he wants to raise the steer's weight to 250 pounds?

7. A 200-pound steer can be sustained on a diet calling for various proportions of grass and grain. These combinations are shown in the table. Pounds of Grass 50 56 60 68 80 88 Pounds of Grain 80 70 65 60 54 52 a. Plot the isoquant corresponding to the inputs necessary to sustain a 200-pound steer. Comment on its shape. b. The rancher's cost of grass is $.10 per pound; the cost of grain is $.07 per pound. He prefers a feed mix of 68 pounds of grass and 60 pounds of grain. Is this a least-cost mix? If not, what is? Explain. c. The rancher believes there are constant returns to scale in fattening cattle. At current feed prices, what input quantities should he choose if he wants to raise the steer's weight to 250 pounds?

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Cost Of Production

Section: Chapter Questions

Problem 3PA

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