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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I DO NOT NEED THE TABLE INSTEAD I NEED THE ANSWERS TO THE QUESTIONS BELOW Quantity of Output Total Variable Cost Total Cost Marginal Cost Average Fixed Cost Average Variable Cost Average Total Cost 1 $20 2 $35 3 $45 4 $60 5 $80 6 $105 7 $140 8 $185 9 $250 10 $340 Imagine yourself running a pizza restaurant over a short term horizon. Think about the following potential changes in your costs. For each, try to discern which would affect your fixed costs from those that are variable costs. Specifically, how would each scenario shift your Average Variable Cost, Marginal Cost, and Average Total Cost curves? Explain your answers. The wages of hourly workers increase The cost of cheese increases The rent on the building housing your restaurant increases The price of gasoline (for pizza delivery) decreases
3. Jane's Juice Bar has the following cost schedules: Quantity 0 vats of juice Variable Cost Total Cost $0 $30 1 10 40 25 55 45 75 70 100 100 130 6. 135 165 a. Calculate average variable cost, average total cost, and marginal cost for each quantity. b. Graph all three curves. What is the relationship between the marginal-cost curve and the average-total-cost curve? Between the marginal-cost curve and the average- variable- cost curve? Explain. 345
Just a discussion post no format needed Topic: Increase in Fixed Costs 1. Suppose a business experiences a sudden increase in its fixed costs. For example, suppose property taxes increase dramatically. What impact, if any, will this have on the following: 1. the firm's AFC (average fixed cost); 2. the firm’s AVC (average variable cost); 3. the firm’s ATC (average total cost); and, 4. the firm’s MC (marginal cost)? 2. What changes, if any, is there likely to be in these same cost CURVES?
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
1. How does fixed cost affect marginal cost? Why is this relationship important? 2. Is it possible for total utility to increase while marginal utility diminishes? Explain. 3. Define economies of scale and explain why they might arise. Define disecononies of scale and explain why they might arise.
2. A company's total cost function as TC = 4,900 + 12Q+4Q Derive the following equations and compute their respective values when Q = 35 a. Average Total Cost (ATC): b. Average Variable Cost (AVC): C. Average Fixed Cost (AFC): d. Marginal Cost (MC):
Use the following table to answer the next question. Output 0 1 2 3 4 5 Total Cost $5 9 12 15 20 27 The average total cost of producing 4 units of output is $ type your answer... Marginal cost is equal to average total cost between type your answer... and type your answer... units of output.
The table below shows the weekly cost of producing cowboy hats. Complete the table by filling in the missing values. Instructions: Round your answers to 1 decimal place. Cowboy Hat Production Costs Total Fixed Cost (dollars) $2,000 Total Variable Cost (dollars) Total Cost (dollars) $2,000 Average Fixed Cost (dollars) Average Variable Cost (dollars) Average Total Cost (dollars) Output $0 10 300 24 $4 $230 20 2,460 23 123 30 660 66.7 22 40 2,900 72.5 50 1,200 24
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…
1. When Fixed Cost change, which of the following other costs will change? Explain why you selected the costs you did. Variable Cost Total Cost Average Total Cost Average Variable Cost Average Fixed Cost Marginal Cost 2. When Variable Cost change, which of the following other costs will change? Explain why you selected the costs you did. Fixed Cost Total Cost Average Total Cost Average Variable Cost Average Fixed Cost Marginal Cost 3. What assumption is made concerning short-run production that causes the short-run cost curves to have their typical shapes?
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)
CENGAGE MINDTAP Homework (Ch 07) 2. Short-run cost formulas Douglas Fur is a small manufacturer of fake-fur boots in New York City. The following table shows the company's total cost of production at various production quantities. Fill in the remaining cells of the table. Total Product Total Cost Marginal Cost Total Fixed Cost Total Variable Cost Average Variable Cost Average Total Cost (Pairs) (Dollars) (Dollars) (Dollars) (Dollars) (Dollars per pair) (Dollars per pair) 120 200 2 240 285 4 340 425 6. 540 On the following graph, plot Douglas Fur's average total cost curve (ATC) using the green points (triangle symbol). Next, plot its average variable cost curve (AVC) using the purple points (diamond symbol). Finally, plot its marginal cost curve (MC) using the orange points (square symbol). (Hint: For ATC and AVC, plot the points on the integer: For example, the average total cost of producing one pair of boots is $200, so you should start your average total cost curve by placing a…