Think Break #7 Grain (lbs) Hay MRTS price ratio 825 1350 900 1130 2.93

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Think Break #7 Grain (lbs) Hay MRTS price ratio 825 1350 900 1130 2.93 975 935 1050 770 2.20 1125 625 1.93 1200 525 1275 445 1.07 The table is rations of grain and hay that put 300 lbs of gain on 900 lb steers. 1) Fill in the missing MRTS 2) If grain is $0.04/lb and hay is $0.03/lb, what is the economically optimal feed ration?

Think Break #7: Answer Grain (lbs) Hay MRTS price ratio 825 1350 1.33 900 1130 2.93 975 935 2.60 1050 770 2.20 1125 625 1.93 1200 525 1275 445 1.07 $0.04/$0.03 = 1.33 = – (935 – 1130)/(975 – 900) = – (525 – 625)/(1200 – 1125) Economic Optimum