Diane's Donuts will begin selling donuts next week. Diane figures that the average variable cost to make each donut will be $0.25. She has paid $20,000 for the donut-making machinery and one year's rent. Refer to Situation 22-1. What will Diane's total variable costs be if she sells 34,500 donuts in one year?

After running a successful pineapple business, Diddy looks for a new business venture. Now he wants to run gold mining business named "Diddy Bling Bling" which produces/sells raw gold. For simplicity, two types of inputs are required to produce raw gold (workers and gold mine). In short- run production, the size of gold mine is fixed while the number or workers can vary. After consulting his business consultant, Diddy computes the following cost table. The quantity of raw gold (kilograms) Averaged Total Cost (gold mine size=small) Averaged Total Cost (gold mine size-medium) Averaged Total Cost (gold mine size-Large) 1 700 1400 1800 2 600 1300 1700 3 500 1200 1600 4 400 1100 1500 5 300 1000 1400 6 400 900 1300 7 500 800 1200 8 610 600 1100 9 700 500 1000 10 800 400 900 11 900 375 800 12 1100 250 700 13 1200 400 600 14 1300 490 500 15 1400 600 400 16 1500 700 350 17 1600 800 300 18 1700 900 350 19 1800 1000 400 20 1900 1100 500 21 2000 1200 600 22 2100 1300 700 Draw Diddy Bling Bling's…

Until recently, Mark worked as a financial advisor, earning $65,000 annually. Then he inherited a piece of commercial real estate that had been renting for $14,000 annually. Mark decided to leave his job and operate a sea food restaurant in the space he inherited. At the end of the first year, his books showed total revenues of $300,000, and paid a total cost of $200,000 for food, utilities, cooks, and other supplies: Show all your work including formulas learned to support your answer for each of the following:    A) Calculate his explicit costs:    B) Calculate his implicit costs.    C) Calculate his accounting profits.    D) Calculate his economic profits.

© Macmillan Learning The figure depicts the long-run average total cost curve for Magma Motors. If this firm is currently producing 11,000 cars per year, what does it experience if it increases output by 1,000 cars? Figure: Long-Run Average Total Cost Curve for Magma Motors Cost (per car) $5,000 4,000 0 Long-run average total cost $10,000 11,000 12,000 Quantity economies of scope economies of scale minimum efficient scale diseconomies of scale