Essentials of Economics (MindTap Course List)
8th Edition
ISBN: 9781337091992
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 12, Problem 3CQQ
To determine
Marginal cost and
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A firm is producing 1,000 units at a total cost of $5,000. If it were to increase production to 1,001 units, its total cost would rise to $5,008.What does this information tell you about the firm?a. Marginal cost is $5, and average variable cost is $8.b. Marginal cost is $8, and average variable cost is $5.c. Marginal cost is $5, and average total cost is $8.d. Marginal cost is $8, and average total cost is $5
Using the following table
Graph the average variable cost, average total cost and marginal cost curves.
Following is the table that shows the cost schedule for a firm operating in a short run.
Quantity Production
(thousands)
Total
Fixed
cost
Total
Variable
cost
Total
Cost
Marginal
Cost
Average
Fixed
Cost
Average
Variable
Cost
Average
Total
Cost
0
$400
0
$400
----
-----
-----
-----
1
$400
$240
$640
$240
$400
$240
$640
2
$400
$320
$720
$80
$200
$160
$360
3
$400
$380
$780
$60
$133.33
$126.66
$260
4
$400
$420
$820
$40
$100
$105
$205
5
$400
$450
$850
$30
$80
$90
$170
6
$400
$490
$890
$40
$66.67
$81.66
$148.33
7
$400
$580
$980
$90
$57.14
$82.85
$140…
The table below shows the cost of producing model vintage cars for collectors.
Instructions: Enter your answers as a whole number.
a. Complete the marginal cost column in the table.
Vintage Model Car Production Costs
Total Fixed Cost
Total Variable
Cost (dollars)
Total Cost
(dollars)
$2,000
(dollars)
$2,000
Marginal Cost
(dollars)
Output
$0
1
2,000
600
2,600
2,000
1,100
3,100
2,000
1,900
3,900
4
2,000
2,900
4,900
5.
2,000
4,150
6,150
b. What is the total cost of producing 4 vintage model cars?
2.
c. What is the marginal cost of producing the 4th vintage model car?
2.
Chapter 12 Solutions
Essentials of Economics (MindTap Course List)
Ch. 12.1 - Prob. 1QQCh. 12.2 - Prob. 2QQCh. 12.3 - Prob. 3QQCh. 12.4 - Prob. 4QQCh. 12 - Prob. 1CQQCh. 12 - Prob. 2CQQCh. 12 - Prob. 3CQQCh. 12 - Prob. 4CQQCh. 12 - Prob. 5CQQCh. 12 - Prob. 6CQQ
Ch. 12 - Prob. 1QRCh. 12 - Prob. 2QRCh. 12 - Prob. 3QRCh. 12 - Prob. 4QRCh. 12 - Prob. 5QRCh. 12 - Prob. 6QRCh. 12 - Prob. 7QRCh. 12 - Prob. 8QRCh. 12 - Prob. 1PACh. 12 - Prob. 2PACh. 12 - Prob. 3PACh. 12 - Prob. 4PACh. 12 - Prob. 5PACh. 12 - Prob. 6PACh. 12 - Prob. 7PACh. 12 - Prob. 8PACh. 12 - Prob. 9PACh. 12 - Prob. 10PA
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