EBK INTERMEDIATE MICROECONOMICS AND ITS
12th Edition
ISBN: 9781305176386
Author: Snyder
Publisher: YUZU
expand_more
expand_more
format_list_bulleted
Question
Chapter 7, Problem 5RQ
a)
To determine
To find the reason forthe same marginal cost.
b)
To determine
To find the comparison of AC with MC in three functions.
c)
To determine
To find the reason of approching MC at large value of q.
d)
To determine
To draw the graph of three fuctions.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Introduction to Calculus in Economics:
Calculus is a powerful tool used in economics. One of the initial applications areas is the study of a firm, a topic in microeconomics. An important function is the cost function function C (x), the cost of producing z items (of whatever they are selling). This question deals with just the cost function C (x).
Problem Set question:
The cost, in dollars, of producing a units of a certain item is given by
C (x) = 10x – 10T -9.
Find the production level that minimizes the average cost per unit.
The number of units that minimizes the average cost is
Introduction to Calculus in Economics:
Calculus is a powerful tool used in economics. One of the initial applications areas is the study of a firm, a topic in microeconomics. An important function is
the cost function function C (z), the cost of producing z items (of whatever they are selling). This question deals with just the cost function C (z).
Problem Set question:
The cost, in dollars, of producing z units of a certain item is given by
C (z) = 5z – 8/I – 3.
Find the production level that minimizes the average cost per unit.
The number of units that minimizes the average cost is Number
Give the formulas for average fixed cost (AFC), marginal cost (MC), average
variable cost (AVC), and average cost (AC) if the cost function is:
26.00
24.00-
C=6+13q.
22.00
Average fixed cost is:
20.00-
18.00
AFC =
* 16.00
Marginal cost is:
14.00-
MC =
10.00
Average variable cost is:
8.00
6.00-
AVC =
4.00
Average cost is:
2.00
0.00-
AC =D
Quantity, q. Units per day
1.) Use the line drawing tool to draw the marginal cost curve. Label this line 'MC'.
If you are viewing this on a test or quiz, you must click the graph to enable
the drawing tools.
2.) Use the 3-point curved line drawing tool to draw the average cost curve for
quantities q= 1, q = 2, and q = 3. Label this curve 'AC'.
Carefully follow the instructions above, and only draw the required objects.
étv
20
MacBook Air
S0
DII
F3
F4
FS
F6
F7
FB
F9
2$
&
3
4
7
8
9
{
[
W
E
R
T
Y
U
P
D
F
G
H
J
K
?
C
V
N
command
option
.. ..
Cost per unit, $
* 0O
Chapter 7 Solutions
EBK INTERMEDIATE MICROECONOMICS AND ITS
Ch. 7.1 - Prob. 1MQCh. 7.1 - Prob. 2MQCh. 7.1 - Prob. 1TTACh. 7.1 - Prob. 2TTACh. 7.2 - Prob. 1MQCh. 7.2 - Prob. 2MQCh. 7.2 - Prob. 1TTACh. 7.2 - Prob. 2TTACh. 7.3 - Prob. 1MQCh. 7.3 - Prob. 2MQ
Ch. 7.3 - Prob. 3MQCh. 7.3 - Prob. 1TTACh. 7.3 - Prob. 2TTACh. 7.5 - Prob. 1TTACh. 7.5 - Prob. 2TTACh. 7.6 - Prob. 1MQCh. 7.6 - Prob. 2MQCh. 7.6 - Prob. 3MQCh. 7.6 - Prob. 1.1MQCh. 7.6 - Prob. 2.1MQCh. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - Prob. 3RQCh. 7 - Prob. 4RQCh. 7 - Prob. 5RQCh. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - Prob. 8RQCh. 7 - Prob. 9RQCh. 7 - Prob. 10RQCh. 7 - Prob. 7.1PCh. 7 - Prob. 7.2PCh. 7 - Prob. 7.3PCh. 7 - Prob. 7.4PCh. 7 - Prob. 7.5PCh. 7 - Prob. 7.6PCh. 7 - Prob. 7.7PCh. 7 - Prob. 7.8PCh. 7 - Prob. 7.9PCh. 7 - Prob. 7.10P
Knowledge Booster
Similar questions
- Consider the following cost function: C(q) = 100 + 10q+q² (i) What are the formulas for the Total Fixed Cost (TFC), Total Variable Cost (TVC), Average Total Cost (ATC) and Marginal Cost? (ii) At what output level is Average Total Cost (ATC) lowest? What is the minimum Average Total Cost (ATC)? (iii)arrow_forwardIntroduction to Calculus in Economics (continued): In the previous Problem Set question, we started looking at the cost function C (æ), the cost of a firm producing z items. An important microeconomics concept is the marginal cost, defined in (non- mathematical introductory) economics as the cost of producing one additional item. If the current production level is æ items with cost C (z), then the cost of computing h additionial (C(z+h)-C(z)) items is C (z + h). The average cost of those h items is . As we analyze the cost of just the last item produced, this can be made into a mathematical model by taking the limit as h → 0, i.e. the derivative C' (z). Use this function in the model below for the Marginal Cost function MC (x). Problem Set question: The cost, in dollars, of producing z units of a certain item is given by C (z) = 0.02a3 – 10z + 450. (a) Find the marginal cost function. MC (z) (b) Find the marginal cost when 50 units of the item are produced. The marginal cost when 50…arrow_forwardA lot of companies use the marginal cost function for their business models to determine the production level to minimize total costs. As we all know, if C (x) represents the total cost of producing x units of a product, then the average cost per unit at this production Let assume C (x) is differentiable on all x > 0 . This implies that the C(x) level is average cost function is also differentiable for all x > 0 since C(x) can be written as C (x) · - , and both C (x) and are differentiable for all x > 0. Suppose you go to an interview and the chairman of the interview committee gives you the following questions: In our company , we use marginal cost to determine the production level to minimize the costs. However, there is another useful model in business, the average cost function, that we also track. 1. Is it true or not that the marginal cost C '(x) is equal to the average cost at the critical points of the average cost function? Please elaborate and explain to us. 2. This year, the…arrow_forward
- Introduction to Calculus in Economics (continued): In the previous Problem Set question, we started looking at the cost function C (x), the cost of a firm producing z items. An important microeconomics concept is the marginal cost, defined in (non-mathematical introductory) economics as the cost of producing one additional item. If the current production level is z items with cost C (x), then the cost of computing h additionial items is C (x+ h). The average cost of those h items (C(x+h)-C(x)) is As we analyze the cost of just the last item produced, this can be made into a mathematical model by taking the limit as h → 0, h i.e. the derivative C' (x). Use this function in the model below for the Marginal Cost function MC (x). Problem Set question: The cost, in dollars, of producing a units of a certain item is given by C (2) = 0.04a3 – 20z+ 350. (a) Find the marginal cost function. a ab b |a| sin (a) a MC (z) = | (b) Find the marginal cost when 60 units of the item are produced. The…arrow_forwardIntroduction to Calculus in Economics (continued): In the previous Problem Set question, we started looking at the cost function C (x), the cost of a firm producing z items. An important microeconomics concept is the marginal cost, defined in (non-mathematical introductory) economics as the cost of producing one additional item. If the current production level is z items with cost C (x), then the cost of computing h additionial items is C (+h). The average cost of those h items (C(r+h)-C(x)) is As we analyze the cost of just the last item produced, this can be made into a mathematical model by taking the limit as h → 0, h i.e. the derivative C' (x). Use this function in the model below for the Marginal Cost function MC (x). Problem Set question: The cost, in dollars, of producing z units of a certain item is given by C (2) = 0.043 – 20x+ 350. (a) Find the marginal cost function. a ab Va a sin (a) MC (x) = E (b) Find the marginal cost when 60 units of the item are produced. The marginal…arrow_forward4. Variouss measures of cost Douglas Fur is a small manufacturer of fake-fur boots in San Diego. The following table shows the company's total cost of production at various production quantities. Fill in the remaining cells of the following table. Quantity Total Cost Marginal Cost (Dollars) Fixed Cost Variable Cost Average Variable Cost Average Total Cost (Pairs) (Dollars) (Dollars) (Dollars) (Dollars per pair) (Dollars per pair) 120 1 200 2 240 3 285 4 340 425 6 540 On the following graph, plot Douglas Fur's average total cost (ATC) curve using the green points (triangle symbol). Next, plot its average variable cost (AVC) curve using the purple points (diamond symbol). Finally, plot its marginal cost (MC) curve using the orange points (square symbol). (Hint: For ATC and AVC, plot the points on the integer; for example, the ATC of producing one pair of boots is $200, so you should start your ATC curve by placing a green point at (1, 200). For MC, plot the points between the integers:…arrow_forward
- When the quantity is placed in the cost equation / function I am getting a different price. Aren't they supposed to give the same price ? Could the equilibrium be solved using the quadratic formula?arrow_forwardQuestion 6: For each of the total cost functions, write the expressions for the average cost, average fixed cost, average variable cost, and marginal cost: 1. TC (Q) = 5Q 2. TC (Q) = 120 +6Q 3. TC (Q) = 6Q² 4. TC (Q) = 140 +5Q²arrow_forward1) Define total cost, average total cost, and marginal cost. How are they related?arrow_forward
- 1. If the average cost of a plant to produce a "q" unit is explained by the functions below this: C = 0.0003q2 - 0.001q + 4 + 20.000/q a. What is the marginal cost function of product q?b. What is the marginal cost when producing 10 units?c. What is the marginal cost when producing 50 units? 2. If the average cost of a plant to produce a "q" unit is explained by the functions below this: C = 0.0001q2 - 0.002q + 5 + 10.000/q a. What is the marginal cost function of product q?b. What is the marginal cost when producing 20 units?c. What is the marginal cost when producing 100 units?arrow_forwardLabel each of the following as sunk cost, opportunity cost, or incremental costs and briefly explain why: (Chapter 2) You are deciding which car to buy. Car A is $24,000 and car B is $32,000. The difference in price is $8,000. What kind of cost does this represent? Answer: Your company invested $300,000 into a study to determine the feasibility of introducing a new product line into the business. The study recommended 2 mutually exclusive feasible alternatives. What kind of cost does the $300K represent? Answer: You have 2 alternatives for a $10,000 investment. Investment A provides a $500 return and investment B provides a $700 return. If you choose Alternative B, what does the $500 return from Alternative A represent? Answer:arrow_forwardGive the formulas for and plot average fixed cost, AFC, marginal cast, MC, average variable cost, AVC, and average cost, AC, if the cost function is: C=12+79-4²+q Marginal cost is MC = 7-8q+3q² Average fixed cost is: 12 4 Average variable cost AVC-7-4q+² AFC- Average cost is: 12 AC+7-4q+q² 1.) Use the 3-point curved line drawing tool to draw the average fixed cost curve for quantities q=1, q=2, and q=3. Labal this line 'AFC 2.) Use the 3-point curved line drawing tool to draw the average variable cost curve for quantities q=1, q=2, and q=3. Label this line AVC. 3.) Use the 3-point curved line drawing tool to draw the average cost curve for quantities q-1, q-2, and q-3. Label this line 'AC'. Carefully follow the instructions above, and only draw the required objecte. 20.00 19.00 18.00 17.00- 56 00 1600- 15.00- 14.00 4545 13.00 13.00 12.00- 11.00- 10.00 9.00 a 8800 7.00 ARD 6.00 GOD 5.00 GOD 4.00 3.00 45 200 1.00 0.00 G Quantity, q. Units per day If you are viewing this an a fost or…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSON
Engineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education