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Output & Costs

Dealing with Competition Models

Given the following: P = 20,000 - 15.6Q and TC= 400,000 +4640Q + 10Q2 where P is the product price, Q is the output level, and Q2 is Q squared A. Given we have a monopoly due to a patent, determine the profit maximizing output level, the monopoly price, and economic profits(High price/high output model). B. Assuming

Operations Decision (Fictitious restaurant industry)

Assume you have been hired as a managing consultant by a company to offer some advice that will help it make a decision as to whether it should shut down completely or continue its operations. It currently uses 100 workers to produce 6,000 units of output per month (working 20 days / month). The daily wage (per worker) is $70, a

Operations Decision

Assume you have been hired as a managing consultant by a company to offer some advice that will help it make a decision as to whether it should shut down completely or continue its operations. It currently uses 100 workers to produce 6,000 units of output per month (working 20 days / month). The daily wage (per worker) is $70, a

Operation Decisions: When Costs Exceed Revenue

Assume you have been hired as a managing consultant by a company to offer some advice that will help it make a decision as to whether it should shut down completely or continue its operations. It currently uses 100 workers to produce 6,000 units of output per month (working 20 days / month). The daily wage (per worker) is $70, a

Optimal Output for Short-Run Profit Maximization

Why is the optimal level of output for short-run profit maximization equal to that level where marginal revenue equals marginal cost? What is the mechanism that will push firms to this level of output?

The Main Outcome of Economics

Is the main outcome of economics (high standard of living) the only relevant question within the realm of economic analysis? Do you agree? Is quality of life also important?

Is the firm minimizing costs? What steps can lower costs?

A firm uses two variable inputs, labor, L, and raw materials, M, with typically shaped isoquants. It pays $20 per hour for L and $5 per unit for M. At the current mix of L and M, the marginal products of L and M are: MPL = 20 MPM = 4 Is the firm minimizing costs? If not, what steps should it take to lower costs and sti

Production Possibilities Frontier Conditions

1. Explain the connections between opportunity cost and the production possibilities frontier ? 2. What is the relationship between the bowed out shape of the production possibilities frontier and the increasing opportunity cost of a good as more of it is produced ? 3. When economists state that the opportunity cost of

This post addresses John's pizza shop and economic decisions

When measuring costs, it is important to keep in mind of one of the Ten Principles of Economics: The cost of something is what you give up to get it. The opportunity cost of an item refers to all those things that must be forgone to acquire that item. When economists speak of a firm's cost of production, they include all the opp

Firm Equity Percentage

The Shoe Outlet has paid annual dividends of $0.65, $0.70, $0.72, and $0.75 per share over the last four years, respectively. The stock is currently selling for $26 a share. What is this firm's cost of equity percentage?

In a competitive market, the market-determined price is $25

In a competitive market, the market-determined price is $25. For a typical firm producing 10,000 units of output, the firm's average cost reaches its minimum value of $25. Is this firm making the profit-maximizing decision? If not, what should the firm do? Question 8 answers No, it is not making the profit-maximizing decis

Rate of Output

ZZZ, Inc. operates in a monopolistically competitive industry. Its demand curve can be written as P = 160 - Q and its short run total cost curve is equal to TC = 1000 + Q^2. What is the rate of output that maximizes ZZZ, Inc.'s short run profits?

Two-Parts Tariff

A monopolist produces output with constant marginal and average cost of 10 $. There are two types of consumers (in equal numbers) that are potentially in the market for the good. Consumers of type A have a demand function of QA = 60 - PA , and consumers of type B have a demand function of QB = 60 -2PB. a. Suppose that the mon

Economic Output Variables

Hernandez Corp. uses two variable inputs, X and Y, to produce its final product, canoes. Its engineering department has estimated the marginal product functions for inputs X and Y as follows: MPx = Y/X MPy = 4 X/Y Where X and Y denote, respectively, the quantity in hours of inputs X and Y used. At present Hernandez Corp.

Hernandez Corp with two variable inputs X and Y

Hernandez Corp. uses two variable inputs, X and Y, to produce its final product, canoes. Its engineering department has estimated the marginal product functions for inputs X and Y as follows: MPx = Y/X MPy = 4 X/Y Where X and Y denote, respectively, the quantity in hours of inputs X and Y used. At present Hernandez Corp.

Profit Mazimization

Output Price Total Cost Total Revenue Marginal Revenue Marginal Cost Profit 0 $1,900 $1000 1 $1,700 $2000 2 $1,650 $2800 3 $1,600 $3500 4 $1,550 $4000 5 $1,500 $4500 6 $1,450 $5200 7 $1,400 $6000 8

Cost of production calculations and graphs

Total Output Cost TFC TVC AFC AVC ATC MC 0 $20 10 $40 20 $60 30 $90 40 $120 50 $180 60 280 1. Use the above table to answer the questions listed below. a. Calculate the total fixed costs, total variable costs, average fixed costs, average variable costs, average total co

Revenue (demand) and cost situation facing an individual firm

Please see attached. 8. Assume the table above shows the revenue (demand) and cost situation facing an individual firm. Further assume this firm has a Total Revenue equation that can be expressed as TR = 20Q. Based on that, answer the following. A. In the table above, fill in the missing values for Price, Total Revenue, Mar

Marginal Analysis

I need some help completing the following assignment: You have been hired to manage a small manufacturing facility, which has cost and production data given in the table below. Total Total Workers Labor Cost Output Revenue 1 $500

Massachusetts Tolls and Externalities

It has been proposed that toll collection on the Massachusetts Turnpike, a key commuter route into Boston from the west, be discontinued. Proponents argue that tolls have long ago paid for the cost of building the road; now they just provide cash for tax bureaucracy. A number of economists are opposing the repeal of tolls on the

Positive and Adverse Supply Shock

Please answer the following question: What is a supply shock? Explain the differences between a beneficial and an adverse supply shock.

Marginal revenue

Assume that the short-run cost and demand data given in the table in the attached file confront a monopolistic competitor selling a given product and engaged in a given amount of product promotion. Compute the marginal cost and marginal revenue of each unit of output.

Jernigan Jerseys is a wholesaler distributing

Jernigan Jerseys is a wholesaler distributing various NFL, NBA, and MLB style jerseys of various quality to minor league and non-professional teams. Two weeks ago they sold 25 jerseys on account to the Canton Catfish varsity football team in Canton, Mississippi for $45 each with an inventory cost of $28 each. Last week seven o

Transactions for CMC (Calrissian Mining Company)

Please match the following transactions for CMC (Calrissian Mining Company) with the appropriate special journal. - Calrissian purchased $1,800 of merchandise on credit from Fett Co., terms n/15 - Calrissian paid salaries $87,425 in cash - Calrissian sold merchandise costing $1,492 on credit to Organa Industries for $1,776,

Using the PPF to model the Cold War

We can use the PPF model to analyze an "Arms Race" between nations to understand and interpret important political events in history. Draw a PPF for military goods and civilian goods production (similar to the traditional example of "guns versus butter"). Then draw another PPF for a country that is about twice the size of the

Economics

The WSJ recently presented data suggesting that United Airlines was not covering its costs on flights from San Francisco to Washington D.C. The article quoted analysis saying that United should discontinue this service. The costs per flight (presented in the article) included the costs of fuel, pilots, flight attendants, food, e

Pricing decisions using third-degree price discrimination.

Pa = 100 - Qa for regular adults and Ps = 50 - 0.5Qs for seniors. Suppose the marginal cost of a round of golf is the same regardless of the age of the player, and MC = 10. a. How much should the course charge regular adults, and how much should it charge seniors.? b. This is an example of which type of price discrimin