A print shop wants to expand production. It currently has 20 workers and 8 copiers and recently added two copiers which increased daily output by 100,000. They also added 4 workers which increased output by 80,000. Each copier costs twice as much as hiring an extra worker. What is the best course of action: hiring another employee, or buying an extra copier

A print shop wants to expand production. It currently has 20 workers and 8 copiers and recently added two copiers which increased daily output by 100,000. They also added 4 workers which increased output by 80,000. Each copier costs twice as much as hiring an extra worker. What is the best course of action: hiring another employee, or buying an extra copier

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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a software production firm, average product has started falling and total output indicated diminishing trend. The production manager Mr. Yahya called you and asked you to see the condition of marginal product. You analyzed the situation and reported that marginal product falling more than average product. Mr. Yahya got surprised. In your opinion which situation the firm is heading to?
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Output (Concession Stand Items) Number of Workers Employed Per day Price of Labor Per Worker Per Day Total Variable Cost of Labor Total Fixed Costs Per Day Total Cost Per Day Average Price of Concession Stand Items Total Revenue Profit Average Variable Cost Average Fixed Cost Average Total Cost Marginal Cost Marginal Revenue 0 0 $120 $2,000 $8.00 100 2 $120 $2,000 $8.00 400 4 $120 $2,000 $8.00
See the cost information in the table below. When this firm produces 5 units, what is the average total cost? Quantity produced/day Total Cost Variable Cost 0 $100 0 1 $175 $75 2 $200 $100 3 $250 $150 4 $280 $180 5 $360 $260 6 $400 $300
Hamza is a young and energetic production manager of a software production firm. With his hard work, he maximized the monthly profit to Rs 750000 while carefully keeping the price of software as Rs 2250. He utilized the resources in such a dynamic way that firm achieved total product of 225 softwares per month. What total cost was incurred on this production?
workers ouput marginal product total cost average total cost marginal cost 0 0 0 200 0 $0 1 20 20 300 $15 $5 2 50 30 400 $8 $3.33 3 90 40 500 $5.56 $2.50 4 120 30 600 $5 $3.33 5 140 20 700 $5 $5 6 150 10 800 $5.33 $10 7 155 5 900 $5.8 $20 a.) can you explain dimisnishing marginal product based on those numbers? b.) compare the column for average total coat and the column for marginal cost. Explain the relationship.
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