Suppose that a firm maximize its total profits and has a marginal cost (MC) of production of $8 and the price elasticity of demand for the product it sells is (-)3. Find the price at which the firm sells the product.
The cost schedule of producing coffee in Hilo is shown below. Output in tones Cost in $ VC ATC AVC MC 0 200 1 437.8 237.8 437.8 237.8 237.8 2 596.4 396.4 298.2
Sparkling Pipes, Inc. offers professional furnace duct cleaning to home owners in Danville, Illinois. The company estimates that each additional room of ducts it cleans costs the firm $10. The owner's daughter did a study and estimated the firm's demand could be described by the following equation, where P stands for price, an
"The best expansion path for a firm contemplating growth is along the points of tangency between the firm's isoquant and isocost lines."
Use Figure 8.2, which represents the situation faced by a monopolist, to answer questions a-c. Figure 8.2 - Attached file a. In Figure 8.2, indicate the profit maximizing price and output level and label them P1 and Q1. b. Shade in the area that represents the firm's economic profit (or loss). c. If this firm wished to
Please help with the following problem. 1) Consider a firm that has just built a plant, which cost $20,000. Each worker costs $5.00 per hour. Based on this information, fill in the table below: (see attached file for table) 2) How would each of the following affect the firm's marginal, average, and average variable cost
I am having trouble intrepreting graphs, and need some help practicing. Please provide a detailed step by step discussion to these questions. Question #4. Consider the Figure below that represents a perfectly competitive firm. See document for graphs and answer the following questions. a. What is the profi
Use the following data for a pure monopoly to calculate the firm's: (a) total revenue, marginal revenue, marginal costs, and average total cost; (b) its profit-maximizing output level and produce price; (c) its profit. (d) Use the price-cost formula to determine whether or not the firm's operations are productively-efficient
If a firm uses two inputs, capital and labor, to produce 500 units of output. Using isoquant and isocost lines, explain what will happen to the cost minimizing input quantities when the price of capital and labor both increase around 20 percent.
Column 1, 2, 3, is derived from a firm's long run expansion path. The price of capital is $50 and the price of labor is $30 Out put Capital Labor Total cost long run Long run average cost Long run marginal cost 20 8 12 40 15 20 60 25 35 80 40 50 Using the above table, answer the following questions a.
In the short run a firms total cost of producing the hundredth unit of output equal $10,000. If it produces one more unit its total costs will increase to $10,150. a. What is the marginal cost of the 101st unit of output? b. What is the firms average total cost of producing 100 units? c. What is the firms average total
A firm is practicing first degree price-discrimination. The demand for the firm's product is defined as QD = 20-2P. If the firm maximizes profits by selling 4 unites of output and the product is infinitely divisible what is the firm's total revenue?
The Dijon Company's total variable cost function is: TVC = 50Q -10Q^2 + Q^3 where Q is the number of units of output produced. a. What is the output level where marginal cost is at minimum? b. What is output level where average variable cost is a minimum? c. What is the value of average va
Consider a firm that has just built a plant, which cost $20,000. Each worker costs $5.00 per hour. Based on this information and using Excel, fill in the missing information in the table below. Number of Worker Hours Output Marginal Product Fixed Cost Variable Cost Total Cost Marginal Cost AVC ATC 0
Need help, please: Cleaners R Us. offers professional motel room cleaning to motel owners in Danville, Illinois. The company estimates that each additional room it cleans costs the firm $10. The owner's daughter did a study and estimated the firm's demand could be described by the following equation, where P stands for price,
The following questions refer to a firm, whose manager recently estimated its average variable cost (AVC) function to be AVC = 88 - 0.026Q + 0.000003Q2 The firm faces total fixed costs (TFC) of $300,000. a. What is the marginal cost of the firm equal to (in dollar terms) when output is 6,000 units? b. Wha
Multiple choice The aggregate supply curve shows the relation between the real interest rate and the aggregate amount of output that firms supply the price level and the aggregate amount of output that firms supply. the supply of goods by firms and the price of goods relative to the price of nonmonetary asse
In the long run, an increase in government purchases of military equipment would cause output to ________ and the aggregate price level to ________.
Fill in the choice: In the long run, an increase in government purchases of military equipment would cause output to ________ and the aggregate price level to ________. stay constant; fall fall; fall fall; stay constant stay constant; rise
You are the manager of a firm that produces output in two plants. The demand for your firm's product is P = 78 - 15Q, where Q = Q1 + Q2. The marginal cost associated with producing in the two plants are MC1 = 3Q1 and MC2 = 2Q2. (1) How much output should be produced in palnt 1 in order to maximize profits? (2) What price
A monopolist produces a single homogeneous good, which he sells in two markets between which discrimination is possible. His total cost function is: TC = Q3 /3 - 40Q2 + 1800Q + 5000 where annual total cost is in dollars and annual output in tons. The demand curves in the two markets are given by the equations q1 = 320 -
Consolidated Sugar company sells granulated sugar to both retail grocery chains and commercial users (e.g., bakeries, candy makers, etc.). The demand function for each of these markets is: Retail grocery chains: P1 = 90 - 4q1 Commercial users: P2 = 50 - 2q2 wher
A monopolist produces a single homogeneous good, which she sells in two distinct markets between which price discrimination is possible. Her total cost function is: TC = 1/3 Q3 - 7.5Q2 + 370Q + 100 The demand curves in the two markets are given by: q1 = 80 - 0.2p1 and q2= Ap2-5 The monopolist achieves a pro
GETTING IT RIGHT: THE SUCCESS OF CONTINENTAL AIRLINES Continental Airlines was doing something that seemed like a horrible mistake. All other airlines at the time were following a simple rule: They would only offer a flight if, on average, 65 percent of the seats could be filled with paying passengers, since only then could t
Cost curves are derived from a data table and graphed. There is also a brief discussion regarding the relationship between average variable costs and marginal costs.
$ Price quantity 100 1 95 2 88 3 80 4 70 5 55 6 40 7 22 8 a. Compute marginal and average revenue. b. Suppose the marginal cost of producing the good is a constant $10 per unit of output. What quantity of output will the firm produc
The short-run marginal cost of the Ohio Bag Company is 2Q. Price is $100. The company operates in a competitive industry. Currently, the company is producing 40 units per period. What is the optimal short-run output? Calculate the profits that Ohio Bag is losing through suboptimal output.
You are given the following long run cost function: TC=160Q-20Q2+1.2Q3 Go from Q=0 to Q=12 A. Calculate the long run average cost and marginal cost. Plot these costs on a graph. I need this set up in excel. B. Describe the nature of this functions scale of economies. Over what range of output does economies of scale exist? D
The Rainbow Paint Co. uses a process-costing system. Materials are added at the beginning of the process and conversion costs are incurred uniformly. Work in process at the beginning of the month is 40 % complete; at the end, 20%. One gallon of material makes one gallon of product. Data follows: Beginning inventory
3. Economists estimated the following cost function for X Corporation C = 50 + 16 Q - 2 Q² + 0.2 Q³ C = Total Cost Q = Quantity produced per period a. Plot the TFC, TFC and TC for the values of Q = 0, 1, 2, 3,.......... 10 b. Calculate the ATC, AVC and MTC and plot on another graph. c. Explain the relationships betw
You are the manager of a firm that produces output in two plants. The demand for your firm's product is P = 78 - 15Q, where Q = Q1 + Q2. The marginal cost associated with producing in the two plants are MC1 = 3Q1 and MC2 = 2Q2. What price should be charged in order to maximize revenues? A. $39 B. $47 C. $52 D. $56