Ike's Bikes is a major manufacturer of bicycles. Right now, the agency produces bikes using only one factory. However, it is considering broadening production to 2 or even 3 factories. The following table shows the company's short-run average full price (SRATC) each month for various levels of production if it supplies one, two, or three factories. (Note: Q amounts to the total amount of bikes developed by all factories.)

Mean Total Cost

(Dollars per bike)

Suppose Ike's Bikes is presently creating 600 bikes per month in its just factory. Its short-run average full expense is (____) per bike.

Suppose Ike's Bikes is expecting to produce 600 bikes per month for a number of years. In this case, in the lengthy run, it would choose to create bikes using(one/two/three factories) .

 Number of Factories Mean Total Cost (Dollars per bike) Q = 100 Q = 200 Q = 300 Q = 400 Q = 500 Q = 600 1 440 280 240 320 480 800 2 620 380 240 240 380 620 3 800 480 320 240 280 440

On the adhering to graph, plot the 3 SRATC curves for Ike's Bikes from the previous table. Specifically, usage the green points (triangle symbol to plot its SRATC if it operates one factory (SRATC1); se the purple points (diamond symbol) to plot its short-run average full expense if it operates two factories (SRATC2); and also u the ovariety points (square symbol to plot its SRATC if it opeprices 3 factories (SRATC3 Finally, plot the long se run average total expense (LRATC) for Ike's Bikes using the blue points (circle symbol). Note: Plot your points in the order in which you would prefer them associated.

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Line segments will affix the points automatically. SRATC 8 480 SRATC 400 320 SRATC 240 160 LRATC 100 200 300 400 500 600 700 QUANTITY OF OUTPUT (Bikes) Economies of Scale Constant Returns to Scale Diseconomic climates of Scale Range Between 300 and 400 bikes per month Fewer than 300 bikes per month More than 400 bikes per month