Chapter 13: Cost of Production Questions: 1. Which is bigger... accounting profit vs. economic profit? Why? 2. Why does marginal product diminish? 3. Which cost curve does diminishing marginal product affect? Why? 4. Fill in Table A. 5. Draw a cost graph below. Show the following: TC, FC, VC 6. Draw an average cost graph below. Show the following: ATC, AVC, AFC, MC 7. On the average cost graph, identify economies and diseconomies of scale Table A Q Fill in the blank spaces of this table. VC TC AFC AVC ATC $50 n/a n/a n/a MC $10

Chapter 13: Cost of Production Questions: 1. Which is bigger... accounting profit vs. economic profit? Why? 2. Why does marginal product diminish? 3. Which cost curve does diminishing marginal product affect? Why? 4. Fill in Table A. 5. Draw a cost graph below. Show the following: TC, FC, VC 6. Draw an average cost graph below. Show the following: ATC, AVC, AFC, MC 7. On the average cost graph, identify economies and diseconomies of scale Table A Q Fill in the blank spaces of this table. VC TC AFC AVC ATC $50 n/a n/a n/a MC $10

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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3. XYZ corporation produces widgets. Its short-run marginal cost curve is given by MC (q) = 10 – 5q + q² (this is a parabola whose minimum occurs at q = 2.5). XYZ's fixed costs are 10. In a two panel diagrams, graph the following cost curves: (a) total cost, (b) total variable cost, (c) total fixed cost, (d) marginal cost, (e) average variable cost, and (f) average total cost. Your diagrams do not need to be scale, but must be internally consistent (i.e. the relationships between different curves must be correct). You do not need to find mathematical expressions for the other cost curves – you only need to sketch lines that are consistent with the shape of the marginal cost curve.
Fill in the Blanks with the options provided. (1) Output is obtained by aggregating the amounts sold, bartered or transferred to other institutional units, plus ____________________. The current accounts record the production of goods and services, the use of incomes for purposes of consumption and saving as well as (2) _________________________. 1a Use of Disposable Income Account1b Allocation of Primary Income Account1c Secondary Distribution of Income Account 2a Current Transfers2b Redistribution of Incomes among Institutional Units
Costs and Profit Maximization: Work It Out 1 Suppose Margie decides to lease a photocopier and open up a black-and-white photocopying service in her dorm room for use by faculty and students. Her total cost, as a function of the number of copies she produces per month, is given in the table. Number of Photocopies Per Month Total Cost Fixed Cost Variable Cost Total Revenue Profit 0 $100 1,000 $110 2,000 $125 3,000 $145 4,000 $175 5,000 $215 6,000 $285 a. Fill in the missing numbers in the table, assuming that Margie can charge 6 cents per black-and-white copy. Margie's fixed cost is: $ Variable cost, 0 photocopies/month: $ Variable cost, 1,000 photocopies/month: $ Variable cost, 2,000 photocopies/month: $ Variable cost, 3,000 photocopies/month: $ Variable cost, 4,000 photocopies/month: $…
QUESTION 4 Assume that there is an implicit cost. Which of the following must be true? a. Accounting Profit > Economic Profit b. Accounting Profit = Economic Profit c. Accounting Profit < Economic Profit d. Accounting Profit - Economic Profit = 0
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The difference between economic profit and accounting profit is? Average cost Direct costs Economic costs Variable costs Marginal costs
1. Your cousin Vinnie owns a painting company with fixed costs of $150 and the following schedule for variable costs: Quantity Variable Cost Average Fixed Cost Average Variable Cost Average Total Cost (Houses Painted per Month) (Dollars) (Dollars) (Dollars) (Dollars) 1 15 2 35 3 60 4 90 5 135 6 240 7 480 The efficient scale is houses. ? #2 image : The city government is considering two tax proposals: • A lump-sum tax of $300 on each producer of hamburgers. • A tax of $1 per burger, paid by producers of hamburgers. Which of the following statements is true as a result of the lump-sum tax? Check all that apply. Which of the following statements is true as a result of the lump-sum tax? Check all that apply. Average variable cost will increase. Average total cost will increase. Average…
question # 2
2. You are thinking about setting up a lemonade stand. The stand itself costs $200. The ingredients for each cup of lemonade cost $0.50. a. How much is your fixed cost of doing business? How much is your variable cost per cup? b. Construct a table showing your total cost, average total cost, and marginal cost for output levels varying from 0 to 10 gallons. (Hint: There are 16 cups in a gallon)
Chris The use of fixed cost items to magnify the firm's results Correct! What are some uses for break-even analysis? Select all that apply, then click Submit below To see how much the changes in cost affect variable costs. To see how much the changes in volume affect cost and profit. To determine the magnitude of operations necessary to avoid loss. To figure out the most efficient level of fixed costs for the firm. To figure out the most inefficient way to make profit. To figure out the operating leverage. Submit
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