Case
Teaching Notes
Supplementary Resources
Abstract
Leonard Funk has been given full operational control of La Marmotte, a canteen restaurant in the French Alps. Based on the information provided in the case, he needs to decide whether to shut down for the summer and/or increase production during the winter.
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Resources
Exhibit A: Variable Costs (Selected Range)a
Students should complete the cost analysis table below.
| Output | Costs | Revenue | Profit | |||||||
| Daily | VC | FC | TC | AVC | ATC | MC | MR | AR | TR | π |
| 86 | 1,244 | |||||||||
| 87 | 1,326 | |||||||||
| 88 | 1,411 | |||||||||
| 89 | 1,499 | |||||||||
| 90 | 1,589 | |||||||||
| 91 | 1,682 | |||||||||
| 92 | 1,777 | |||||||||
| 93 | 1,876 | |||||||||
a. The formula for marginal cost is but a valid approximation is .
