Next questionThe estimated short-run cost function of a Japanese beer manufacturer is7001.67C(q) = 0.5qAt what positive quantity does the average cost function reach its minimum? If a $300 per-unit tax is applied to the firm, at what positive quantity is the after-tax average cost minimized?Average cost before the tax is minimized at a quantity of q =units. (Enter your response rounded to three decimal places.)Average cost with the $300 tax is minimized at a quantity of q =units. (Enter your response rounded to three decimal places.)

Answered: Average cost with the $300 tax is…

Average cost with the $300 tax is minimized at a quantity of q = units. (Enter your response rounded to three decimal places.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Cost of Production

In economic theory, production costs are the costs incurred by an industrial organization when it engineers a project or provides a service that generates revenue and benefits. Labor costs, raw materials, consumable manufacturing costs, and general overhead sum up, accounting for production costs. Total cost data is calculated by combining total direct costs of materials, labor costs, and total production costs.

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