Explore BrainMass
Share

# Production Questions for Cost

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

2) At the end of the year, a firm produced 18,000 lab top computers. Its total costs were \$8 million , and its fixed costs were \$5 million. what are the avg. variable costs of this firm?
3) The cost structure of a manufacture of microchips is described in the table shown below . The firm fixed costs equal \$15,000 per day. Calculate the average variable cost, average fixed cost, and avg. total cost at each output level.
output (microchip per day) total cost of output avg. variable cost(\$) avg.fixed cost (\$) avg. total cost (\$)
0 15,000 -------- ------------ ----------------
15,000 65,000
40,000 100,000
65,000 155,000
90,000 225,000
115,000 330,000
140,000 470,000
6) The table below represents the hourly output and cost structure for a local pizza shop. The market is perfectly competitive, and the market price of a pizza In the area is \$10. Total costs include all implicit opportunity cost. Calculate the pizza shop's marginal revenue at each rate of output and fill in the values in the table.
total hourly output & sales of pizzas total hourly cost(\$) TR (\$) total economic profit (\$) MC (\$) MR (\$)
0 3 0 0 ------ -------
1 7 10 3
2 9 20 11
3 10 30 20
4 12 40 28
5 16 50 34
6 22 60 38
7 30 70 40
8 40 80 40
9 52 90 38
7) The campus barber faces stiff completion from the large number of shops that surround the campus area, and for all practical purposes the market is perfectly competitive. He charges \$10 for a haircuts hair for 18 people a day. His shop is open 5 days a week. Calculate his weekly total revenue.
11) Given the information in the table @ the right ,Calculate the dry cleaner's marginal revenue (MR) & marginal cost @ each output level.
output suites cleaned price per suit (\$) TC (\$) TR(\$) MC(\$) MR(\$)
0 8.00 3.00 0.00 ------ -------
1 7.50 6.00 7.50
2 7.00 8.50 14.00
3 6.50 10.50 10.50
4 6.00 16.50 24.00
5 5.50 13.50 27.50
6 5.00 16.00 30.00
7 4.50 19.00 31.50
8 4.00 24.00 32.00
12) Currently, a monopolist's profit-maximizing output is 300 unit per week. It sells its output @ a price of \$55 per unit and collect \$35 per unit in revenues from the sale of the last unit produced each week. The firm's total costs each week are?--------
13) The following table shows demand a d marginal cost for a monopolist. Calculate marginal revenue at each quantity.
output (units) price per unit marginal revenue marginal cost
0 56 ---- -------
1 45 10
2 35 20
3 25 30
4 15 40
5 5 50
8) Suppose that a perfectly competitive firm faces a market price of \$7 per unit and @ this price the upward-sloping portion of the firms marginal cost curve crosses its marginal revenue curve at an output level of 1,400 units, its average variable costs equal \$6.50 per unit , and its average fixed cost equal \$0.80 per unit. What is the firm's profit-maximizing ( or loss minimizing ) output level? ( include minus sign if necessary.)
9) The following table shows marginal and avg. total cost schedules for a perfectly competitive firm. Currently, the market price in this industry is \$40. output (units) marginal cost avg. total cost
0 -------- --------
1 10 35
2 20 28
3 30 18
4 40 31
5 50 35
A profit - maximizing firm will produce ------- units
14) Currently, a monopolist's profit- maximizing output is 250 units per week. It sells its output @ a price of\$70 per unit and collects \$40 per unit in revenues from the sale of the last unit produced each week. The firms total costs each week are &8,500. Given this information, the firm's maximized weekly economic profits are \$______________.
21) Suppose that the distribution of sales within an industry is as shown in the following table:
Firm share of total market sales
A 17
B 12
C 13
D 10
E 10
F 10
G 8
H 7
all others 13
total 100%
There are 13 " all other" in the industry in the above table, each of which has a share of sales equal to 1%. The value of the Herfindahl- Hirschman index for this industry is --------------.
23) Suppose that the distribution of sales within an industry is as shown in the table. What is the four -firm concentration ratio for this industry? firm share of total market sales
A 16
B 15
C 14
D 12
E 9
F 7
G 5
H 4
all other 18
total 100%

© BrainMass Inc. brainmass.com March 22, 2019, 3:27 am ad1c9bdddf
https://brainmass.com/economics/basic-economic-concepts-and-principles/production-questions-cost-616539

#### Solution Preview

See the attached file. Thanks

2) At the end of the year, a firm produced 18,000 lab top computers. Its total costs were \$8 million , and its fixed costs were \$5 million. what are the avg. variable costs of this firm?
c \$80,00,000.00
Fixed Cost \$50,00,000.00
Total Variable cost \$30,00,000.00 Note: Total Variable ost = Total Cost - Fixed Cost
No of laptops produced 18,000
Average variable cost \$166.67 Note: Average variable cost = Total variable ost / Number of units produce

3) The cost structure of a manufacture of microchips is described in the table shown below . The firm fixed costs equal \$15,000 per day. Calculate the average variable cost, average fixed cost, and avg. total cost at each output level.

"Output
(microchip per day)" Total cost of output Average Variable Cost (\$) Avarage Fixed Cost (\$) Average Total Cost (\$)
0 \$15,000
15000 \$65,000 \$3.33 \$1.00 \$4.33
40000 \$1,00,000 \$2.13 \$0.38 \$2.50
65000 \$1,55,000 \$2.15 \$0.23 \$2.38
90000 \$2,25,000 \$2.33 \$0.17 \$2.50
115000 \$3,30,000 \$2.74 \$0.13 \$2.87
140000 \$4,70,000 \$3.25 \$0.11 \$3.36

6) The table below represents the hourly output and cost structure for a local pizza shop. The market is perfectly competitive, and the market price of a pizza In the area is \$10. Total costs include all implicit opportunity cost. Calculate the pizza shop's marginal revenue at each rate of output and fill in the values in the table.
Total Hourly Output & Sales of Pizzas Total Hourly ...

#### Solution Summary

Show how to calculate HHI, concentration risk and 10 other questions on production function.

\$2.19