Assume that the most efficient production technology available for making vitamin pills has the cost structure given in the followingtable. Note that output is measured as the number of bottles of vitamins produced per day and that costs include a normal profit.OutputTCMCATC25,400$104,000$0.5450,400154,0001.0475,400191,5002.54100,400279,5003.04Instructions: Enter your answers rounded to two decimal places.a. What is ATC per unit for each level of output listed in the table? Enter your answers in the table above.b. Are there economies of scale in production?Yesc. Suppose that the market price for a bottle of vitamins is $2.54. At that price the total market quantity demanded is 105,560,000bottles. How many firms will be in this industry?firm(s)d. Suppose that, instead, the market quantity demanded at a price of $2.54 is only 75,400. How many firms will be in this industry?firm(s)

a) Output TC MC ATC 25400 104000 0.54 104000/25400= 4.09 50400 154000 1.04 154000/50400= 3.05…

Assume that the most efficient production technology available for making vitamin pills has the cost structure given in the following table. Note that output is measured as the number of bottles of vitamins produced per day and that costs include a normal profit. Output TC MC ATC 25,400 $104,000 $0.54 50,400 154,000 1.04 75,400 191,500 2.54 100,400 279,500 3.04

Assume that the most efficient production technology available for making vitamin pills has the cost structure given in the following table. Note that output is measured as the number of bottles of vitamins produced per day and that costs include a normal profit. Output TC MC ATC 25,400 $104,000 $0.54 50,400 154,000 1.04 75,400 191,500 2.54 100,400 279,500 3.04

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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