Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN: 9781305506381
Author: James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 15, Problem 5E
To determine
To Explain: The organizational form that would be adopted by the power plant owners, when the coal mine tonnage can be cheaply shipped anywhere, while an adjacent coal-fired power plant cannot be re-deployable for other uses.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
What collective term would be used to describe the employees, investors, suppliers, and customers of a manufacturer of laboratory equipment?
A company manufactures Products A, B, and C. Each product is processed in three departments: I, II, and III. The total available labor-hours per week for Departments I, II, and III are 1020, 1080, and 900, respectively. The time requirements (in hours per unit) and the profit per unit for each product are as follows.
Product A
Product B
Product C
Dept. I
2
1
2
Dept. II
3
1
2
Dept. II
2
2
1
Profit
$18
$12
$15
If management decides that the number of units of Product B manufactured must equal or exceed the number of units of products A and C manufactured, how many units of each product should the company produce to maximize its profit?
an American multinational that sells consumer electronic products, has manufacturing facilities in three countries: Brazil, Thailand, and Canada. The average hourly wage rate, output per worker, and annual overhead cost for each location are as follows:
Given the above figures, is Storm currently allocating its production resources optimally? If not, what should it do? Justify your answer. Now, suppose that Storm is planning to consolidate all its manufacturing into one facility. Where should it locate? Justify your answer.
Chapter 15 Solutions
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
Knowledge Booster
Similar questions
- Perum Perindo operates 2,500 hectares of shrimp pond in Bratasena, Lampung. There are many players in this market, including the traditional shrimp farmers and big companies listed in the IDX stock market. The product in this market is relatively standardized. It is known that perum Perindo total cost function is TC= 20 + 4Q + 0.003Q2 and the market price for a kilo of shrimp is $16. a. Identify the market structure that perum Perindo operates inb. Find Perindo marginal costc. Find the equilibrium output leveld. Write the firm variable cost and average variable cost functione. At the equilibrium level of output that has been calculated in question c , find the firm average variable cost (AVC)f. At current price level, should the firm continue to produce or shut down it operation? Explainarrow_forwardYou are managing sports apparel sales. The way contracts are writlen, you purchase the rights to buy a fixed block of copyrighted materials for a negotiated price for a given yoar. You then sell these materials through your channels and try to make the moat possible. Apparel sales are automated through online channels so the additional cost of selling a given unit is negligible. In other words, the cost structure is relatively fixed no matter how many units you sell. What is an aporopriate optimization target for this type of cost structure and what will elasticity equal if you optimize prices well?arrow_forwardPerum Perindo operates 2,500 hectares of shrimp pond in Bratasena, Lampung. There are many players in this market, including the traditional shrimp farmers and big companies listed in the IDX stock market. The product in this market is relatively standardized. It is known that perum Perindo total cost function is TC = 20 + 4Q + 0.003Q2 and the market price for a kilo of shrimp is $16. d. Write the firm variable cost and average variable cost functione. At the equilibrium level of output that has been calculated in question c , find the firm average variable cost (AVC)f. At current price level, should the firm continue to produce or shut down it operation? Explainarrow_forward
- A mail carrier at the U.S. Postal Service works on Sunday delivering high-priority letters and packages. She can deliver 15 items per hour The fixed hourly costs (vehicle depreciation, insurance, etc.) equal $33 and the hourly variable costs (time and a half wages, etc.) total $0.80 per item delivered. How much must the U.S. Postal Service charge for each item delivered in order to break even on Sunday deliveries? The U.S. Postal Service must charge $ for each item delivered in order to break even on Sunday deliveries. (Round to the nearest cent) Enter your answer in the answer boxarrow_forwardWhat factors are critical to the success of Dar's efforts to revive ICRISAT?arrow_forwardWindies Cricket manufactures Windies supporter jerseys. The quantity q, of these jerseys demanded weekly is related to the wholesale price per jersey p, by the following equation: P = 0.006q+15 The weekly total cost incurred by Windies Cricket for producing q jerseys is: C(q) = 38q - 0.02q² + 30,000 d. Will Windies Cricket record a loss or profit if they were to produce and sell 2450 jerseys? e. If Windies Cricket wishes to maintain a total cost less than $42,000.00, what range(s) of Windies jerseys should be produced. f. Calculate the equilibrium price and quantity for Windies jerseys.arrow_forward
- XYZ Corporation produced 300 units of output but sold only 250 of the units it produced. The average cost of production for each unit of output produced was $100. Each of the 250 units sold was sold for a price of $95. What would total revenue for XYZ Corporation be? -$3875 $3875 $23,750 $25,500arrow_forwardFor many airlines in the short run, a major portion of the cost of production, such as aircraft and terminal space is fixed. Should these very large FCs be ignored when the revenue managers are making output and pricing decisions? Provide at least 2 reasons why they should or should not be ignored.arrow_forwardWhy would a new oil refinery have difficulty competing successfully with large oil refiners such as Chevron, Shell Oil, or ExxonMobil?arrow_forward
- Pixie Arts and Graphics, a medium scale printing press business has determined the equation that describes the relationship of the price and demand of one of its products as Price=150 - 0.01•D (D as Demand per unit) for an annual printing of this product. The fixed costs annually = P50,000 and the variable cost = P40 per unit. Requirement: a. What is the maximum profit that can be earned? b. What is the unit price at this point of optimal demand if demand is not to be anticipated to exceed more than 6,000 units annually? Hint: Profit (loss) = total revenue – total costs = (aD – bD²) – (Cf + CyD)arrow_forwardAccording to estimates, the economic cost per job saved by protecting US textile and apparel industries is much higher than the wages of the jobs saved is much lower than the wages of the jobs saved is reflected in the Logistics Performance Index is accounted for by the “Smiley Curve” is forced upon manufacturers in foreign countriesarrow_forwardXY Inc. produces certain product at a labor cost of $10 and material cost of $15 per unit. The fixed charges of the firm is $10,000 per month, and the variable costs besides the material and labor costs are $8 per unit. The products are sold wholesale at $63 each. Using this information. the break even sales volume of the firm is Blank 1 units Blank 1 Add your answerarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial Economics: Applications, Strategies an...EconomicsISBN:9781305506381Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. HarrisPublisher:Cengage Learning
Managerial Economics: Applications, Strategies an...
Economics
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:Cengage Learning