Problem 1 Section 1: The Equimarginal Principle in a Production EnvironmentThe following questions incorporate the information below.A grape grower with a vineyard in the Edna Valley and in the Carneros appellation inSonoma/Napa has a contract to produce 500 tons of pinot noir grapes for Constellation Brands.The current allocation of the 300 tons results in a marginal cost of production in the Edna Valleyvineyard of $2500 (MCEV = $2500) and a marginal cost of production in the Carneros vineyard of$2100 (MCc = $2100).Question Q1mont noitavellsV anb3 of 301emeWrite the equimarginal principle for the production context.Quereqsin to not eno evom uoyerli wallol boy terit grimuses bris noites airit to pninniged orfi is bebivong stab erti no boombne erit linu ylloemco elgioning lanigremiusSvelleV enb3 to laco Isnin

Allocation of grape production is 300tons The MC of Edna Valley=$2500 The MC of Cameros=$2100…

Answered: one yells of 30101 principle for the…

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one yells of 30101 principle for the production context. Question Q1 Write the equimarginal

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter3: Benefits, Costs, And Decisions

Section: Chapter Questions

Problem 9MC

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A grape grower with a vineyard in the Edna Valley and in the Carneros appellation in Sonoma/Napa has a contract to produce 18 tons of pinot noir grapes for Gallo. The current allocation of the 18 tons results in a marginal cost of production in the Edna Valley vineyard of $800 (MCev = $800) and a marginal cost of production in the Carneros vineyard of $1200 (MCc = $1200). Explain whether the grower should move one ton of production from the Edna Valley to Carneros or vice versa. Make sure to provide a clear explanation of the outcome consistent with the idea of the equimarginal principle. Make sure to use the correct terms and units.
The figure shows a bakery's marginal and average cost curves, and its isoprofit curves. The bakery is a price-taker in a large bread market. Suppose the current market price is P₁. Based on this information, which of the following statements is correct? Price, Cost €6 (5 20 40 60 80 Quantity MC hoprofits AC 100 120 140 160 180 number of loaves Select one or more: a. The bakery would be better off raising its price up to its AC level. O b. The bakery would be minimising its loss at A. Oc. If the bakery is not yet in the market then it would not enter the market. d. If the bakery is already in the market, then it would always immediately exit the market because it is making a loss.
Hi! Can you help me with the question below? Northside Social (NS) sells cups of coffee and amazing breakfast sandwiches. The current price of a cup of coffee is $3.00 and the current price of an amazing breakfast sandwich is $8.00. At those prices, NS sells 1000 cups of coffee and 200 breakfast sandwiches daily. NS faces a constant marginal cost for each cup of coffee of 50 cents and the constant marginal cost of breakfast sandwiches is $2. NS increases the price of coffee 5%, to $3.15. After the price increase, NS sells 900 cups of coffee, a decrease of 10% in cups of coffee. Demand for coffee at NS at this price interval is best described as:A) ElasticB) InelasticC) Unitary ElasticD) Perfectly Elastic
The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Buddies, a purely competitive firm that produces novelty ear buds. Assume the market for novelty ear buds is a competitive market and that the price of ear buds is $6.00 per pair. Buddies Production Costs Quantity MC ATC of Ear Buds ($) ($) 25 2.20 30 2.02 2.17 35 2.45 2.21 40 3.57 2.38 45 4.00 2.56 50 5.46 2.85 55 5.93 3.13 60 8.53 3.58 Instructions: In part a, enter your answer as the closest given whole number. In parts b-d, round your answers to two decimal places. a. If Buddies wants to maximize profits, how many pairs of ear buds should it produce each week? pairs b. At the profit-maximizing quantity, what is the total cost of producing ear buds?
The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Buddies, a purely competitive firm that produces novelty ear buds. Assume the market for novelty ear buds is a competitive market and that the price of ear buds is $6.00 per pair. Buddies Production Costs Quantity MC ATC of Ear Buds ($) ($) 20 1.00 25 2.00 1.20 30 2.46 1.41 35 3.51 1.71 40 4.11 2.01 45 5.43 2.39 50 5.99 2.75 55 8.47 3.27
A local company is planning to manufacture and market a four-slice toaster. For this toaster, the research department’s estimates are aweekly demand of 300 toasters at a price of $25 per toaster and a weekly demand of 400 toasters at a price of $20. The financial department’s estimates are fixed weekly costs of$5,000 and variable costs of $5 per toaster. a) Assume that the relationship between price ? and demand ? is linear. Use the research department’s estimates to express ? as a function of ? and determine the domain of the function. b) Using your knowledge from Finite Math, determine the Revenue function in terms of ?. c) Determine the Marginal Revenue at 2 different production levels for example 250 and 500 units. Interpret these results. (HINT: Consider what a positive or negative first derivative implies) d) Assume that the cost function is linear. Use the financial department’s estimates to express the cost function interms of ?. e) Determinethe Marginal costand interpret the…
Distinguish between technical efficiency and economic efficiency
The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Buddies, a purely competitive firm that produces novelty ear buds. Assume the market for novelty ear buds is a competitive market and that the price of ear buds is $6.00 per pair. Buddies Production Costs Quantity MC АТС of Ear Buds ($) ($) 9.00 - 10 2.00 5.50 15 2.44 4.48 20 3.56 4.25 25 4.50 4.30 30 5.02 4.42 35 5.96 4.64 40 8.56 5.13 Instructions: In part a, enter your answer as the closest given whole number. In parts b-d, round your answers to two decimal places. a. If Buddies wants to maximize profits, how many pairs of ear buds should it produce each week? pairs b. At the profit-maximizing quantity, what is the total cost of producing ear buds? c. If the market price for ear buds is $6 per pair, and Buddies produces the profit-maximizing quantity of ear buds, what will Buddies profit or loss be per week? 2$ d. Now assume the market price is $5.50 per pair, and Buddies produces the…
|1.6.1 A company manufactures and sells x dellphones per week. The weekly price-demand and cost equations are given below. p= 400 - 0.5x and C(x) = 20,000 + 140x (A) What price should the company charge for the phones, and how many phones should be produced to maximize the weekly revenue? What is the maximum weekly revenue? The company should produce (Round to the nearest cent as needed.) phones each week at a price of $ The maximum weekly revenue is $ (Round to the nearest cent as needed.) (B) What price should the company charge for the phones, and how many phones should be produced to maximize the weekly profit? What is the maximum weekly profit? The company should produce (Round to the nearest cent as needed.) phones each week at a price of $ The maximum weekly profit is $ (Round to the nearest cent as needed.)
You are one of 5 identical firms (i. e., you all have the same costs) that sell widgets. Each day you have a fixed cost of $9 to operate. The marginal cost of your first widget is $1; second is $2; third $3; fourth $7; and for the fifth it is $8. You have a capacity constraint of 5, and you can only produce a whole number of widgets. Part 2 The AVC for a firm that produces 2 widgets is $ enter your response here. (Round your answer to 2 decimal places as needed)
Kenji's Performance Pizza is a small restaurant in Ottawa that sells gluten-free pizzas. Kenji's very tiny kitchen has barely enough room for the two ovens in which his workers bake the pizzas. Kenji signed a lease obligating him to pay the rent for the two ovens for the next year. Because of this, and because Kenji's kitchen cannot fit more than two ovens, Kenji cannot change the number of ovens he uses in his production of pizzas in the short run. However, Kenji's decision regarding how many workers to use can vary from week to week because his workers tend to be students. Each Monday, Kenji lets them know how many workers he needs for each day of the week. In the short run, these workers are ______ (VARIABLE or FIXED) inputs, and the ovens are ______ (VARIABLE or FIXED) inputs.
The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Buddies, a purely competitive firm that produces novelty ear buds. Assume the market for novelty ear buds is a competitive market and that the price of ear buds is $6.00 per pair. Buddies Production Costs MC ($) Quantity of Ear Buds 5 10 15 20 25 30 35 40 2.00 2.45 3.55 4.00 5.50 5.98 8.52 pairs ATC ($) 2.00 2.00 2.15 2.50 2.80 3.25 3.64 4.25 Check my work Instructions: In part a, enter your answer as the closest given whole number. In parts b-d, round your answers to two decimal places. a. If Buddies wants to maximize profits, how many pairs of ear buds should it produce each week? b. At the profit-maximizing quantity, what is the total cost of producing ear buds? c. If the market price for ear buds is $6 per pair, and Buddies produces the profit-maximizing quantity of ear buds, what will Buddies profit or loss be per week? d. Now assume the market price is $5.50 per pair, and Buddies produces the…