Chapter 11

Revenue Curve The figure shows that growing the second bushel of wheat is profitable. More specifically, in the figure we see that it costs Jonathan $2 to grow bushel number 2, and that Jonathan can sell this bushel for $4. Hence on the second bushel Jonathan makes $2 profit. The $2 profit is equal to the shorter blue arrow in the figure.

Because Jonathan can make a profit by producing the second bushel, he will produce it. But at this point, you might yell " STOP!"