Assume that an appliance manufacturer is employing variable resources X and Y in such amounts that the MRPs of the last unves of X and Y employed are $80 and $70, respectively. Resource X can be hired at $40 per unit and resource Y at $60 per unit. The firm Me Choice producing with the leest costly combination of X and Y but codd increase is profes by employing more o could incess to profits by emping of brand where

Assume that an appliance manufacturer is employing variable resources X and Y in such amounts that the MRPs of the last unves of X and Y employed are $80 and $70, respectively. Resource X can be hired at $40 per unit and resource Y at $60 per unit. The firm Me Choice producing with the leest costly combination of X and Y but codd increase is profes by employing more o could incess to profits by emping of brand where

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Assume that an appliance manufacturer is employing variable resources X and Y in such amounts that the MRPs of the last units of X and Y employed are $80 and $70, respectively Resource X can be hired at $40 per
unit and resource Y at $60 per unit. The firm
Muple Choice
is producing with the les combination of X and Y but could increase its profts by employing more of Xands of
fe
barot raksh ma bet of y
< Prey 1033
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310 185 170 95 80 65 $ A profit-maximizing firm will break even when market price is $ SMC If market price is $80, a profit-maximizing firm will produce ATC 0 1100 1600 1900 The figure above shows cost curves for a perfectly competitive firm. Suppose that market price is $310. A firm producing 1 700 units of output should produce AVC 9 units of output instead, to earn profits of $ units of output and earn profits of $
10. the olowing graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,000. Fixed cost is $120,000. + APMP 100 80 60 MP AP 20 40 60 80 100 120 140 10 Labor What is AVC at its minimum? Multiple Choice O $80 when AP is maximzed O $15 . O$25 .O$40 120000 . O$100 2,000 Ave rage ard m arginal prodictof labor
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A chair manufacturer hires its assembly-line labor for $20 an hour and calculates that the rental cost of its machinery is $10 per hour. Suppose that a chair can be produced using 4 hours of labor or machinery in any combination. If the firm is currently using 2 hours of labor for every two hours of machine time, is it minimizing its cost of production? If so, why? If not, how can it improve the situation? The firm O A. is not currently minimizing its cost of production because the ratio of the marginal product of labor to the marginal product capital is equal to the ratio of the wage rate to the rental cost. O B. is currently minimizing its cost of production because its marginal rate of technical substitution less than the ratio of input prices. C. is not currently minimizing its cost of production because the marginal product of labor divided by the wage is less than the marginal product of capital divided by the rental cost. O D. is currently minimizing its cost of production…
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Doan's Headphones company is innovative enough to have a monopoly in their market where they sell 80 million headphones each year. The marginal cost of making headphones is very low and Doan's analytic's department realize that if it dropped prices by 30% sales would rise enough that the company's profits would also increase. This result suggests that at Doan's current output: Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a MC=MR b MC is lower than MR MC is higher than MR
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Which of the following is FALSE? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a VMP and MRP Comparison Homework Unanswered Due Nov 28th, 11:59 PM b C For a perfectly competitive firm, the factor demand curve is the same as the MRP curve and the VMP curve. For a price searcher, its VMP curve lies above its MRP curve. For a price searcher, its VMP curve is its factor demand curve. d A firm that faces a horizontal (perfectly elastic) supply curve of factors is called a factor price taker.