Answered: 1) Complete the following table: Output…

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:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter9: Applications Of Cost Theory

Section: Chapter Questions

Problem 3E

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1) Complete the following table: Total Cost 50 Output 0 345 WNIO 1 2 3 6 BORONG Output 0 60 123456 75 100 150 225 400 2) Apu leases 2 squishy machines to produce 40 squishies in the short run. Apu's short-run cost function is: C(q, K) = 0.85-9² +0.5K, where q is the number of squishies produced and K is the number of squishy K² Total Cost Variable Cost machines used. Apu's long-run cost function is: CLR(q) = 1.139 what happens to Apu's short-run average total cost of producing 40 squishies? Does Apu's long-run cost function exhibit increasing, constant, or decreasing returns to scale? 3) Complete the following table: 90 180 Fixed Cost Variable Fixed Cost Cost 60 10 Marginal Cost 80 Marginal Cost 20 213. 50 If Apu decides to lease 7 squishy machines,

1) Complete the following table:
Output
0
1
2
3
4
5
6
Output
0
Total
Cost
50
1
2
60
75
100
150
225
400
2) Apu leases 2 squishy machines to produce 40 squishies in the short run. Apu's short-run cost function is:
C(q. K) - 0.85-22+0.5K, where q is the number of squishies produced and K is the number of squishy
K2
3456
machines used. Apu's long-run cost function is: CLR(q)-1.1347
342/3. If Apu decides to lease 7 squishy machines,
what happens to Apu's short-run average total cost of producing 40 squishies? Does Apu's long-run cost
function exhibit increasing, constant, or decreasing returns to scale?
3) Complete the following table:
Total
Cost
Variable Fixed
Cost Cost
90
180
Marginal
Cost
Variable Fixed Marginal
Cost
Cost
Cost
60
10
80
20
50

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