Costs in the short run versus in the long runhelp me 3. Costs in the short run versus in the long runIke's Bikes is a major manufacturer of bicycles. Currently, the company produces bikes using only one factory. However, it is considering expandingproduction to two or even three factories. The following table shows the company's short-run average total cost (SRATC) each month for various levelsof production if it uses one, two, or three factories. (Note: Q equals the total quantity of bikes produced by all factories.)Average Total Cost(Dollars per bike)Number of Factories Q = 50Q = 100Q = 150Q = 200Q = 250Q = 3001180100801202003602270150808015027036020012080100180Suppose Ike's Bikes is currently producing 50 bikes per month in its only factory. Its short-run average total cost is sper bike.Suppose Ike's Bikes is expecting to produce 50 bikes per month for several years. In this case, in the long run, it would choose to produce bikes using In the following table, indicate whether the long-run average cost curve exhibits economies of scale, constant returns to scale, or diseconomies ofscale for each range of bike production.RangeEconomies of Scale Constant Returns to Scale Diseconomies of ScaleBetween 150 and 200 bikes per monthMore than 200 bikes per monthFewer than 150 bikes per month

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3. Costs in the short run versus in the long run Ike's Bikes is a major manufacturer of bicycles. Currently, the company produces bikes using only one factory. However, it is considering expanding production to two or even three factories. The following table shows the company's short-run average total cost (SRATC) each month for various levels of production if it uses one, two, or three factories. (Note: Q equals the total quantity of bikes produced by all factories.) Average Total Cost (Dollars per bike) Q = 50 Q = 200 Q = 300 Number of Factories Q = 100 Q = 150 Q = 250 %3D %3D 180 100 80 120 200 360 2 270 150 80 80 150 270 3 360 200 120 80 100 180 Suppose Ike's Bikes is currently producing 50 bikes per month in its only factory. Its short-run average total cost is s per bike. 1.

3. Costs in the short run versus in the long run Ike's Bikes is a major manufacturer of bicycles. Currently, the company produces bikes using only one factory. However, it is considering expanding production to two or even three factories. The following table shows the company's short-run average total cost (SRATC) each month for various levels of production if it uses one, two, or three factories. (Note: Q equals the total quantity of bikes produced by all factories.) Average Total Cost (Dollars per bike) Q = 50 Q = 200 Q = 300 Number of Factories Q = 100 Q = 150 Q = 250 %3D %3D 180 100 80 120 200 360 2 270 150 80 80 150 270 3 360 200 120 80 100 180 Suppose Ike's Bikes is currently producing 50 bikes per month in its only factory. Its short-run average total cost is s per bike. 1.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter7: Production, Costs, And Industry Structure

Section: Chapter Questions

Problem 28RQ: What shape of a long-run average cost curve illustrates economies of scale, constant returns to...

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Costs in the short run versus in the long run

help me

In the following table, indicate whether the long-run average cost curve exhibits economies of scale, constant returns to scale, or diseconomies of
scale for each range of bike production.
Range
Economies of Scale Constant Returns to Scale Diseconomies of Scale
Between 150 and 200 bikes per month
More than 200 bikes per month
Fewer than 150 bikes per month

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