5. Your aunt is thinking about opening a hardware store. She estimates that it would cost $500 000per year to rent the location and buy the stock. In addition, she would have to quit her $50 000per year job as an accountantDefine opportunity costa.b. What is your aunt's opportunity cost of running a hardware store for a year? If your auntthought she could sell $510 000 worth of merchandise in a year, should she open the store?Explain

a.Opportunity cost is the value of the next best alternative that we foregone while making a…

Answered: 5. Your aunt is thinking about opening…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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III 123 Verdana 12 A A- Aa BIU abe X, x2 Styles 3. Complete the following table: See module 3 notes, chapter 13; there is a table that will show you how to work this. Total Average Average Average Marginal Variable Total cost Output Total Total Fixed Variable Cost Fixed Costs Cost 24 Cost Cost cost O$ 00で$ $50 $200 50.00 1. 45.00 000 06 2. 40.00 3. 4. 120 000 000 40.00 44.00 50.00 096 000 220 5. 6. 000 7. 8. 57.14 65.00 000 00 200 520 670 000 000 74.44 90.00 006 e 2 of 3 253 words E 00% Zoom Air
5. Copy and correctly fill in the following table below for the cost chart for Vin Scully Bobbleheadso 1 mistake =-1 2 mistakes = -2 3 mistakes = No credit Q FC AFC VC AVC TC ATC MC 1 100 10 3 45 14 40 16 25 6. 50
QUESTION 18 Amir and Samir run a business that sets up and tests computers. Assume that Amir and Samir can switch between setting up and testing computers at a constant rate. The following table applies: Amir Samir A. 36 B. 48 C. 60 Minutes Needed to D.64 Set Up 1 Computer 48 30 Test 1 Computer ? 40 Number of Computers Set Up or Tested in a 40-Hour Week Computers Set Up Refer to the table above. The number of minutes needed by Amir to test a computer is 50 80 Computers Tested 40 60
9. Firm's Cost Schedule Gilberto's Juice Bar has the following cost schedules: In the following table, complete the marginal cost, average variable cost, and average total cost columns. Quantity Variable Cost Total Cost Marginal Cost (Vats of juice) (Dollars) (Dollars) (Dollars) Average Variable Cost Average Total Cost (Dollars) (Dollars) о 0 30 1 2 3 4 5 100 135 ' བྷ ཐཱུ བྷཱུ ཋ ཏྟཱ ཤྲཱ 10 40 55 45 75 70 100 130 165 On the following graph, use the orange points (square symbol) to plot the marginal-cost curve for Gilberto's Juice Bar. (Note: Be sure to plot from left to right and to plot between integers. For example, if the marginal cost of increasing production from 1 vat of juice to 2 vats of juice is $5, then you would plot a point at (1.5, 5).) Then use the purple points (diamond symbol) to plot the average-variable cost curve starting at 1 vat of juice, and use the green points (triangle symbol) to plot the average-total-cost curve also starting at 1 vat of juice. Cast 8 20 я 20…
4. Sherry runs a dog grooming business. She has rent of $5,000 per month and must have an assistant to work with her to keep things going. The assistant costs $3,500 per month and supplies cost $1,500 per month. Sherry also has a storage unit where she keeps equipment that she might need at a cost of $1,000 per month. What should Sherry do under the following scenarios? Be sure to show your calculations. a. Sherry has monthly revenue of $8,000 b. Sherry has monthly revenue of $5,000 c. Sherry decides to shut down d. Of the alternatives presented above, which one presents the best outcome? Explain.
4. Various measures of cost Douglas Fur is a small manufacturer of fake-fur boots in Denver. The following table shows the company’s total cost of production at various production quantities.
How does the firm increase its production in the long-run? What input/s can it use to increase production?
4. Use the information in the following graph to find the values for the following at an output level of 1000: Cost (per unit) $30 20 15 3. b. C. d. Marginal cost Total cost 1000 Variable cost Fixed cost MC ATC AVC Quantity of output
Solve for the missing entries in the above table. Enter whole dollar values for Total and Marginal Cost calculations. Round all average cost calculations to the nearest cent. Enter your answers in the following format: A. $5 B. $18 C. $40 etc. (Note, this is just an example, these are NOT the correct answers.)
15 3. Jane's Juice Bar has the following cost schedules: Quantity 0 vats of juice $0 1 10 12 25 3 45 4 70 100 135 10 1 12 13 14 15 Variable cost Total cost $30 40 55 75 100 130 165 Calculate average variable cost, average total cost, and marginal cost for each quantity. Put these numbers in the table below. Quantity Average variable cost Average total cost Marginal cost a. b. Graph all three curves (average variable cost, average total cost and marginal cost) using Excel or a piece of grid paper. Attach the graph to this assignment. What is the relationship between the marginal-cost curve and the average total cost curve? Between the marginal cost curve and the average variable cost curve? Explain
4. Costs in the short run versus in the long run Ike's Bikes is a major manufacturer of bicycles. Currently, the company produces bikes using only one factory. However, it is considering expanding production to two or even three factories. The following table shows the company's short-run average total cost each month for various levels of production if it uses one, two, or three factories. (Note: Q equals the total quantity of bikes produced by all factories.) Number of Factories Q= = 100 1 2 3 180 250 320 Q = 200 120 160 200 Average Total Cost (Dollars per bike) Q = 300 Q = 400 80 120 80 80 120 80 Q = 500 200 160 120 Q: = 600 320 250 180 Suppose Ike's Bikes is currently producing 100 bikes per month in its only factory. Its short-run average total cost is $ per bike. Suppose Ike's Bikes is expecting to produce 100 bikes per month for several years. In this case, in the long run, it would choose to produce bikes using
oc ?

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