Answered: n 1997, researchers at Texas A&M…

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter7: Proudction Costs

Section: Chapter Questions

Problem 17SQ

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A company makes solar panels. The company's revenue function, in dollars, is R(n) =10n, where n is the number of panels produced. The cost function is C(n) 100 (2)30. R and C are shown on the graph below. 1000 800 600 400 200 1 20 40 60 80 100 in Number of Panels a) Estimate from the graph i) the break-even points ii) the number of panels that should be produced for maximum profit b) Write the equation for the profit function P. c) Graph P. d) Use your graph of P to estimate the number of panels that give maximum profit. e) How would your answers for break-even points and maximum profit change if ) the number of dollars of revenue per panel is increased slightly? ii) the cost function is changed to C(n) 100(2)35? f) What does the number that was changed in part e) ii) represent?| %3D Dollars
A company makes solar panels. The company's revenue function, in dollars, is R(n)= 10n , where n is the number of panels produced. The cost function is C(n) = 100(2)30 . R and C are shown on the graph below. 1000 800 600 400 200 20 40 60 80 100 1 Number of Panels a) Estimate from the graph i) the break-even points e) How would your answers for break-even points and maximum profit change if i) the number of dollars of revenue per panel is increased slightly? ii) the cost function is changed to C(n)=100(2)35 ? f) What does the number that was changed in part e) ii) represent? Dollars
A study of the costs of electricity generation for a sample of 56 British firms in 1946-1947 yielded the following long-run cost function: (Source: Johnston, "Chapter 4," in Statistical Cost Analysis) AVC = 1.24 + 0.0033Q + 0.00000290² Q = output; measured in millions of kWh per year Z = plant size; measured in thousands of kilowatts where AVC = average variable cost (i.e., working costs of generation), measured in pence per kilowatt-hour (kWh). (A pence was a British monetary unit equal, at that time, to 2 cents U.S.) What is the long-run total variable cost function for electricity generation? 1.24 +0.0033 +0.0000029Q -0.000046Z 0.026Z 0.000182² Q Q Q ○ 0.0033 +20.0000029Q -0.000046 Z O 0.0033Q +20.00000290² - 0.000046 QZ O 1.24Q +0.0033Q² +0.0000029Q³ – 0.000046Q²Z – 0.026ZQ+0.00018Z²Q What is the long-run marginal cost function for electricity generation? 0.000046 QZ O 0.0033Q +20.0000029Q² +0.000046 QZ O 1.24 +0.0066Q+0.0000087Q² - 0.000092QZ – 0.026Z+0.00018Z2 O +0.0033…

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