Figure 73 shows the short-run cost curves for a producer. In the figure below, lines H, J. and K represent Figure 7.3 Select one: marginal product, average product, and total product, respectively average fixed cost, average total cost, and average variahle cost, respectively marginal cost, average total cost, and average variable cost, respectively. average total cost, marginal cost, and average variable cost, respectively marginal cost, average product, average total cost, respectively

Figure 73 shows the short-run cost curves for a producer. In the figure below, lines H, J. and K represent Figure 7.3 Select one: marginal product, average product, and total product, respectively average fixed cost, average total cost, and average variahle cost, respectively marginal cost, average total cost, and average variable cost, respectively. average total cost, marginal cost, and average variable cost, respectively marginal cost, average product, average total cost, respectively

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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6. Firm's Costs 2 Consider the following cost information for a pizzeria: Quantity Total Cost Variable Cost (Dozens of pizzas) (Dollars) (Dollars) 280 1 320 40 2 350 70 3 380 100 4 420 140 470 190 6 530 250 The pizzeria's fixed cost is Complete the third column of the following table by calculating the marginal cost per dozen pizzas using the information on total cost. Then complete the final column by calculating the marginal cost per dozen pizzas using the information on variable cost. Quantity Total Cost Marginal Cost Variable Cost Marginal Cost Using Total Cost (Dollars) Using Variable Cost (Dollars) (Dozens of pizzas) (Dollars) (Dollars) 280 320 40 350 70 AA
Question 3 Discuss the relationship between Long-Run Average Cost and Short-Run Average Cost for a firm. Show this diagrammatically. What are the strategic implications of a Long-Run Average Cost curve showing existence of economies of scale?
Let F be the fixed cost of production, let VC be the variable cost of production, C be the total cost, MC be the marginal cost, AFC, the average fixed cost, AVC, the average variable cost, and AC, the average cost. Complete the following cost table. (Enter numeric responses rounded to two decimal places.) Output (q) 1 2 3 4 5 6 7 8 9 10 F $250 250 250 250 250 250 250 250 250 с MC AFC AVC AC $266 $16 $250.00 $16.00 $266.00 12 125.00 14.00 139.00 8 83.33 12.00 4 62.50 10.00 72.50 298 50.00 59.60 8 310 12 41.67 10.00 51.67 76 326 35.71 10.86 46.57 96 346 20 12.00 43.25 41.11 27.78 13.33 120 370 24 148 28 25.00 14.80 VC $16 28 278 36 286 40 48
The four statements below describe properties of a firm's short run cost curves. Complete the statements using words from the list given below. • The increase in total cost from producing an additional unit of output is called • Average cost is the total cost of When a firm's average cost curve crosses the marginal cost curve, average costs are When a firm's average cost is greater than marginal cost, then producing an additional unit of output will result in a fall in average cost marginal cost at a minimum at a maximum production production divided by the quantity of units produced
Use the cost table below to find the following marginal costs. Output quantity Total variable Total fixed Total cost cost cost 20 80 60 140 40 140 60 200 60 210 60 270 80 300 60 360 100 420 60 480 120 600 60 660 140 840 60 900 What is the marginal cost when output is 20? $ What is the marginal cost when output is 80? $ What is the marginal cost when output is 120? $ |
long-run cost relationships
Fill in the blanks in the table below. The problem is a "puzzle" so the blanks are not necessarily filled in sequentially. (Hint: Determine the total fixed cost first.) Instructions: Enter your answers rounded to two decimal places. Total Average Fixed Cost Average Total Cost Marginal Cost Output Variable Total Cost Cost 1 $10.00 $9.76 $9.76 $19.76 2 $19.06 $14.53 $9.30 $29.06 3 $3.33 $12.63 $37.90 4 $2.50 $36.31 $11.58 $8.41 $46.31 $2.00 $44.30 $10.86 LO
The following is a cost schedule for A & E Manufacturing Company Ltd for product X. Quantity (Q) Fixed Cost Variable Cost Total Cost Marginal Cost Average Fixed Cost Average Variable Cost Average Total Cost 0 100 1 30 2 25 3 60 4 100 18 Required: Calculate the missing costs and complete the schedule. On one diagram, plot and label the Marginal Cost curve, the Average Fixed Cost curve, Average Variable Cost Curve and the Average Total Cost curve. Explain the relationship which exists between the Marginal Cost Curve and the Average Total Cost Curve. What accounts for the ‘U’ shape of the Average Total Cost Curve?
Which is the correct formula for the total cost of production?Note: TC is total Cost, AFC is average fixed cost, AVC is average variable cost, MC is marginal cost, TVC is total variable cost, TFC is total fixed cost, and Q is output. PLEASE EXPLAIN THE ANSWER A. TC = (AFC + AVC) (Q) B. TC = TVC + TFC C. TC = (MC)(Q) D. A and B are correct E. A, B and C are correct
The average fixed cost curve will never intersect with either the horizontal or vertical axis. graph. There must be proper positioning of the Average Total Cost curve and Average Variable Cost curve. graph. The Average Total Cost curve and Average Variable Cost curve must not touch (in between is average fixed costs – which can never be zero). graph.
Let F be the fixed cost of production, let VC be the variable cost of production, C be the total cost, MC be the marginal cost, AFC, the average fixed cost, AVC, the average variable cost, and AC, the average cost. Complete the following cost table. (Enter numeric responses rounded to two decimal places.) Output (q) 1 2 3 4 31 5 6 7 8 9 06 10 F $200 200 200 200 200 200 200 200 200 VC $48 84 108 120 144 344 380 228 428 288 488 60 560 с MC $248 $48 AFC AVC AC $200.00 $48.00 $248.00 284 36 100.00 42.00 142.00 308 24 66.67 36.00 12 50.00 30.00 80.00 24 40.00 68.80 36 33.33 30.00 63.33 28.57 32.57 61.14 36.00 61.00 40.00 62.22 44.40 360 444 72 84 22.22 20.00
Complete the table by filling in the average fixed cost, average variable cost, and average total cost. Instructions: Round your answers to 2 decimal places. Vintage Model Car Production Costs Output Total Fixed Cost (dollars) Total Variable Cost (dollars) Total Cost (dollars) Average Fixed Cost (dollars) Average Variable Cost (dollars) Average Total Cost (dollars) 0 $2,000 $0 $2,000 — — — 100 2,000 800 2,800 200 2,000 1,300 3,300 500 2,000 4,350 6,350