Ali is operating his firm under a perfectly competitive industry. The fixed cost of his firm per day is TK 100. The variable cost depends on the labour wage and quantity of the commodity produced. The following tables shows the variable cost and quantity of the output produced- Quantity Variable Cost (TK) Total Cost (TK) 100 10 200 300 20 300 400 30 480 580 40 700 800 50 1000 1100 a. Calculate the average variable, average total and marginal cost for each quantity of output. b. Calculate the break-even price and what is the shutdown price from the table? c. Suppose per unit price of the commodity charged by Ali is TK 17, do you think Ali will

Ali is operating his firm under a perfectly competitive industry. The fixed cost of his firm per day is TK 100. The variable cost depends on the labour wage and quantity of the commodity produced. The following tables shows the variable cost and quantity of the output produced- Quantity Variable Cost (TK) Total Cost (TK) 100 10 200 300 20 300 400 30 480 580 40 700 800 50 1000 1100 a. Calculate the average variable, average total and marginal cost for each quantity of output. b. Calculate the break-even price and what is the shutdown price from the table? c. Suppose per unit price of the commodity charged by Ali is TK 17, do you think Ali will

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: Average Marginal Quantity Total Cost Total Cost Cost 0 $10.00 1 15.00 $15.00 $5.00 2 17.50 8.75 2.50…

A: Perfect competitive market refers to a type of market structure where the producers as well as…

Q: The above cost curves are for a firm producing flour, which is measured in pounds. 1. What is the…

A: A cost curve is a graph that shows the costs of production as a function of the overall quantity…

Q: Based on the above information, fill in the following COST TABLE for Green Berry Farms Berry…

A: Formula: Total cost=Total fixed cost+Total variable costTotal variable cost=Quantity of farmworkers…

Q: Graphically show the relationship between the total fixed cost, the total variable cost, and the…

A: Total Cost = Total Fixed Cost + Total Variable Cost

Q: QUESTION 2 The table below gives the short run production function for the firm, Jack's Moving…

A: By looking at the table, we want to input the correct amounts under Total Fixed Cost (TFC), Total…

Q: Fill in the table below applying the cost equations.

A: Total cost = Total Fixed cost + Total variable cost Total variable cost = Average variable cost ×…

Q: 2. The weekly marginal cost of producing x ice cream makers is 28+ 0.05x dollars per ice cream…

A: Cost function can be written as follows:

Q: Output per hour 0 1 Total Cost $ $ ՄԴ 1,000 1,200

A: Total cost is the sum of fixed cost and variable cost. Fixed cost is the cost that remains same at…

Q: The table gives some of the costs of the Delicious Pie Company. The marginal cost per pie of…

A: Here, the given table provides information about total variable cost and total cost at different…

Q: What factors affect the cost of production in the long-run? Pick all that apply Multiple answers:…

A: The inputs such as capital, labour and land are used to produce and output in the market is known as…

Q: Identify the economies of scale where the producer operates. Show cost curves of the firm…

A: The economies of scale means when the level of production or output is raised, the average cost of…

Q: $5,000 per month. Variable cost at the current evel of output of 100 tables per month is $10,0 Which…

A: A variable cost is a corporate expense that changes in proportion to how much a company produces or…

Q: Answer the question on the basis of the following cost data. Average Fixed Output Cost Average…

A: Total fixed cost is average fixed cost multiplied by the quantity of output produced. Total Fixed…

Q: The figure above illustrates the long-run average cost curve for a firm that produces picture…

A: The average cost refers to the per-unit cost of production. The minimum efficient scale is reached…

Q: A price-taking firm makes air conditioners. The market price of one of its new air conditioners is…

A: Airconditioner per day to maximize profit= 2 per day Marginal costs are follow as presented in the…

Q: A D Quantity (units per day Curve C represents which type of cost curve? O A. marginal cost (MC) B.…

A: Average total cost is the sum of average Fixed cost and average variable cost. Average Fixed cost…

Q: Figure 13-9 The figure below depicts average total cost functions for a firm that produces…

A: The entire cost of manufacturing divided by the total number of units produced yields the average…

Q: Gooey Bites sells snack packs for $3 per pack. Variable expenses involved in producing snack packs…

A: The total cost function is the aggregate of all fixed and variable costs incurred in the process of…

Q: A firm faces the following table of costs for various levels of production, if they can sell their…

A: 1- Continue the production At price of 1.33 , the output produced will be 45 units because at this…

Q: The curves below reflect information about the average total cost, average fixed cost, average…

A: Average fixed cost is a measure of fixed cost which gives value of fixed cost per unit of…

Q: Mariam's Kitchen offers catered meals in a perfectly competitive industry. Mariam's machinery costs…

A: Total cost shows the total cost of producing a good. Total cost includes the fixed cost and the…

Q: Consider the table below showing the costs for a firm. Quantity Fixed Cost Variable Cost Total Cost…

A: Total cost is the sum of fixed and variable cost. Fixed cost remains same at all level of output.…

Q: Assume that in the short run a firm is producing 500 units of output, has average total costs of…

A: Total cost (TC): - it is the sum of fixed and variable costs incurred in the production process.…

Q: If the explicit cost of producing each chair is $27 and the implicit cost is $11, then what is XYZ…

A: Opportunity cost is the forgone amounts that is because of choosing the current alternative.…

Q: The Banana computer company produces affordable, easy-to-use home computer systems and has fixed…

A: Analysis of AC can be used to calculate profit or loss. A company will turn a profit if the price it…

Q: Quantity of cars Oa Ob Oc Od 1-8 6-8 1 2 46 3 4 5 6 7 8 LRATC of car $30,000 20,000 The wagon is a…

A: A firm which is long-run average total cost (LRATC) shows the average cost per unit of output over a…

Q: Use your knowledge of cost functions to calculate the missed cost data in the accompanying table.…

A: Based on the provided information and the cost functions, I have filled out the missing data in the…

Concept explainers

Cost of Production

The entire idea of the cost of production or production cost is applied corresponding, or we can say that it is related to monetary cost. Money cost refers to any money expenditure which the firm or supplier, or producer undertakes in purchasing or hiring factor of production or factor services.

Question

Ali is operating his firm under a perfectly competitive industry. The fixed cost of his firm per day is TK
100. The variable cost depends on the labour wage and quantity of the commodity produced. The
following tables shows the variable cost and quantity of the output produced-
Quantity
Variable Cost (TK)
Total Cost (TK)
100
10
200
300
20
300
400
30
480
580
40
700
800
50
1000
1100
a. Calculate the average variable, average total and marginal cost for each quantity of
output.
b. Calculate the break-even price and what is the shutdown price from the table?
c. Suppose per unit price of the commodity charged by Ali is TK 17, do you think Ali will
С.
able to earn profit in the short run? Explain.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

The following incomplete table describes the costs faced by a firm as it produces an increasing quantity of output. All costs are in dollars. Many cells are left blank and you may need to fill some of them in to answer the question: Average Average Total Quantity Total Cost Marginal Cost Variable Cost Cost 1 45 10 8 3 59 4 16 In dollars, what are this firm's fixed costs? 2.
The following incomplete table describes the costs faced by a firm as it produces an increasing quantity of output. All costs are in dollars. Many cells are left blank and you may need to fill some of them in to answer the question: Average Average Total Quantity Total Cost Marginal Cost Variable Cost Cost 1 45 10 8 3 59 4 16 In dollars, what is this firm's marginal cost of producing its fourth unit of output?
Explain the meaning of fixed costs. Provide a few examples of firms' costs that are likely to be fixed in the short run. Describe what the graphs of both total fixed cost and average fixed cost would look like. What is the relationship between Average Total Cost, Average Variable Cost, and Average Fixed Cost? What costs are fixed over the long run?
© Macmillan Learning The figure depicts the long-run average total cost curve for Magma Motors. If this firm is currently producing 11,000 cars per year, what does it experience if it increases output by 1,000 cars? Figure: Long-Run Average Total Cost Curve for Magma Motors Cost (per car) $5,000 4,000 0 Long-run average total cost $10,000 11,000 12,000 Quantity economies of scope economies of scale minimum efficient scale diseconomies of scale
Using the numbers representing short run costs in the chart below, calculate the number that belongs in the blank space. q = quantity, TFC = Total Fixed Cost, TVC = Total Variable Cost, AVC = %3D %3D Average Variable Cost Recall that an "X" in the chart means that no number goes in that space. TFC TVC AVC 300 300 150 75 300 270 135 3. 300 370 123.33 4 300 480 300 650 130 300 840 140 1. 2. 6
Consider a small dental practice. Which of the following is NOT an example of a fixed cost? Rent on the office space O The receptionist's salary O Fees to renew the dentist's license each year O X-ray film
Please answer all questions
The table below shows cost data for producing different amounts of cleaning products. Use the given information to find the Average Variable Cost. Quantity Total Cost Average Variable Cost 11 1 2 فيا 4 5 28 46 60 65 68 4. 4. 1.
A firm's fixed costs for 0 units of output and its average total cost of producing different output levels are summarized in the table below. Complete the table to find the fixed cost, variable cost, total cost, average fixed cost, average variable cost, and marginal cost at all relevant levels of output. Q FC vC TC AFC AVC ATC MC $15,000 100 300 200 200 300 175 400 225 500 325 600 400
Classify the following milk bar short-run costs as fixed cost or variable cost Milk truck Fruit freezer Cost of milk sold each day ii) Assuming the following are the costs of your milk bar after the end of the second week answer the question below based on the following information. Fixed cost increased from 100 to 150 Variable cost increases from 220 to 300 Milk output increases from 450 to 620 a) What is the average total cost during the second week. Show your work b) What is the marginal cost. Show your work
The table shows three short-run cost schedules for three plants of different sizes that a firm might build in the long run. Plant 1 Plant 2 Plant 3 Output ATC Output ATC Output ATC 10 $ 10 10 $ 15 10 $ 20 20 9 20 10 20 15 30 8 30 7 30 10 40 9 40 10 40 8 50 10 50 14 50 9 What is the long-run average cost of producing 10 units of output? Multiple Choice $10 $15 $20 $45
The following table represents the short-run total cost schedule of a bottled water manufacturer. Study the table below and then answer the question. When output increases from 30 to 80 bottles of mineral water, the marginal cost of producing one of those 50 bottles of mineral water is: Labour (workers per day) Output (bottles of mineral Total cost (R) water per day 0 0 400 1 30 700 2 80 1000 3 120 1300 4 140 1 600 5 150 1900 a) R5 b) R6 이이 c) R12,50 d) R20