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Johnston, "Chapter 4," in Statistical Cost Analysis) AVC 1.24 0.0033Q + 0.0000029Q² 0.000046 QZ 0.026Z + 0.00018Z² where AVC = average variable cost (i.e., working costs of generation), measured in pence per kilowatt-hour (kWh). (A pence was a British monetary unit equal, at that time, to 2 cents U.S.) Q = output; measured in millions of kWh per year Z = plant size; measured in thousands of kilowatts What is the long-run total variable cost function for electricity generation? 0.0033 +20.0000029Q -0.000046Z ○ 1.24Q+0.0033Q² +0.000002903 -0.000046Q2Z-0.026ZQ+0.00018Z²Q ○ 0.0033Q+20.0000029Q² -0.000046 QZ 1.24+0.0033+0.0000029Q-0.000046 Z-0.02 + Q 0.00018Z Q What is the long-run marginal cost function for electricity generation? 1.24+0.0066Q+0.0000087Q² -0.000092QZ-0.026Z +0.00018 Z² ○ 0.0033Q+20.0000029Q² + 0.000046 QZ 1.24+0.0033+0.0000029+0.000046Z+ 0.025% 0.00018Z Q Q ○ 1.24Q+0.0033Q² +0.000002903+0.000046Q2Z +0.026ZQ+0.00018Z²Q Holding plant size constant at 150,000 kilowatts, what is the short-run average variable cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39+0.0066Q+0.0000029Q² 1.39-0.0072Q+0.0000029Q2 1.39-0.0036Q+0.0000029Q2 1.24+0.0033Q+0.0000029Q2 Holding plant size constant at 150,000 kilowatts, what is the short-run marginal cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39 -0.0072Q+0.0000087Q2 ○ 1.39 -0.0036Q+0.0000029Q² 1.39+0.0066Q+0.0000029Q² 1.24+0.0033Q+0.0000029Q2 For a plant size equal to 150,000 kilowatts, what is the output level that minimizes short-run average variable costs? year million kWh per At the output level thus obtained, the short-run average variable cost is per kWh. pence per kWh and the short-run marginal cost is pence

Johnston, "Chapter 4," in Statistical Cost Analysis) AVC 1.24 0.0033Q + 0.0000029Q² 0.000046 QZ 0.026Z + 0.00018Z² where AVC = average variable cost (i.e., working costs of generation), measured in pence per kilowatt-hour (kWh). (A pence was a British monetary unit equal, at that time, to 2 cents U.S.) Q = output; measured in millions of kWh per year Z = plant size; measured in thousands of kilowatts What is the long-run total variable cost function for electricity generation? 0.0033 +20.0000029Q -0.000046Z ○ 1.24Q+0.0033Q² +0.000002903 -0.000046Q2Z-0.026ZQ+0.00018Z²Q ○ 0.0033Q+20.0000029Q² -0.000046 QZ 1.24+0.0033+0.0000029Q-0.000046 Z-0.02 + Q 0.00018Z Q What is the long-run marginal cost function for electricity generation? 1.24+0.0066Q+0.0000087Q² -0.000092QZ-0.026Z +0.00018 Z² ○ 0.0033Q+20.0000029Q² + 0.000046 QZ 1.24+0.0033+0.0000029+0.000046Z+ 0.025% 0.00018Z Q Q ○ 1.24Q+0.0033Q² +0.000002903+0.000046Q2Z +0.026ZQ+0.00018Z²Q Holding plant size constant at 150,000 kilowatts, what is the short-run average variable cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39+0.0066Q+0.0000029Q² 1.39-0.0072Q+0.0000029Q2 1.39-0.0036Q+0.0000029Q2 1.24+0.0033Q+0.0000029Q2 Holding plant size constant at 150,000 kilowatts, what is the short-run marginal cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39 -0.0072Q+0.0000087Q2 ○ 1.39 -0.0036Q+0.0000029Q² 1.39+0.0066Q+0.0000029Q² 1.24+0.0033Q+0.0000029Q2 For a plant size equal to 150,000 kilowatts, what is the output level that minimizes short-run average variable costs? year million kWh per At the output level thus obtained, the short-run average variable cost is per kWh. pence per kWh and the short-run marginal cost is pence

Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter3: Benefits, Costs, And Decisions
Section: Chapter Questions
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Johnston, "Chapter 4," in Statistical Cost Analysis) AVC 1.24 0.0033Q + 0.0000029Q² 0.000046 QZ 0.026Z + 0.00018Z² where AVC = average variable cost (i.e., working costs of generation), measured in pence per kilowatt-hour (kWh). (A pence was a British monetary unit equal, at that time, to 2 cents U.S.) Q = output; measured in millions of kWh per year Z = plant size; measured in thousands of kilowatts What is the long-run total variable cost function for electricity generation? 0.0033 +20.0000029Q -0.000046Z ○ 1.24Q+0.0033Q² +0.000002903 -0.000046Q2Z-0.026ZQ+0.00018Z²Q ○ 0.0033Q+20.0000029Q² -0.000046 QZ 1.24+0.0033+0.0000029Q-0.000046 Z-0.02 + Q 0.00018Z Q What is the long-run marginal cost function for electricity generation? 1.24+0.0066Q+0.0000087Q² -0.000092QZ-0.026Z +0.00018 Z² ○ 0.0033Q+20.0000029Q² + 0.000046 QZ 1.24+0.0033+0.0000029+0.000046Z+ 0.025% 0.00018Z Q Q ○ 1.24Q+0.0033Q² +0.000002903+0.000046Q2Z +0.026ZQ+0.00018Z²Q Holding plant size constant at 150,000 kilowatts, what is the short-run average variable cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39+0.0066Q+0.0000029Q² 1.39-0.0072Q+0.0000029Q2 1.39-0.0036Q+0.0000029Q2 1.24+0.0033Q+0.0000029Q2 Holding plant size constant at 150,000 kilowatts, what is the short-run marginal cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39 -0.0072Q+0.0000087Q2 ○ 1.39 -0.0036Q+0.0000029Q² 1.39+0.0066Q+0.0000029Q² 1.24+0.0033Q+0.0000029Q2 For a plant size equal to 150,000 kilowatts, what is the output level that minimizes short-run average variable costs? year million kWh per At the output level thus obtained, the short-run average variable cost is per kWh. pence per kWh and the short-run marginal cost is pence
Transcribed Image Text:Johnston, "Chapter 4," in Statistical Cost Analysis) AVC 1.24 0.0033Q + 0.0000029Q² 0.000046 QZ 0.026Z + 0.00018Z² where AVC = average variable cost (i.e., working costs of generation), measured in pence per kilowatt-hour (kWh). (A pence was a British monetary unit equal, at that time, to 2 cents U.S.) Q = output; measured in millions of kWh per year Z = plant size; measured in thousands of kilowatts What is the long-run total variable cost function for electricity generation? 0.0033 +20.0000029Q -0.000046Z ○ 1.24Q+0.0033Q² +0.000002903 -0.000046Q2Z-0.026ZQ+0.00018Z²Q ○ 0.0033Q+20.0000029Q² -0.000046 QZ 1.24+0.0033+0.0000029Q-0.000046 Z-0.02 + Q 0.00018Z Q What is the long-run marginal cost function for electricity generation? 1.24+0.0066Q+0.0000087Q² -0.000092QZ-0.026Z +0.00018 Z² ○ 0.0033Q+20.0000029Q² + 0.000046 QZ 1.24+0.0033+0.0000029+0.000046Z+ 0.025% 0.00018Z Q Q ○ 1.24Q+0.0033Q² +0.000002903+0.000046Q2Z +0.026ZQ+0.00018Z²Q Holding plant size constant at 150,000 kilowatts, what is the short-run average variable cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39+0.0066Q+0.0000029Q² 1.39-0.0072Q+0.0000029Q2 1.39-0.0036Q+0.0000029Q2 1.24+0.0033Q+0.0000029Q2 Holding plant size constant at 150,000 kilowatts, what is the short-run marginal cost function for electricity generation? (Note: Z is measured in thousands of kilowatts) 1.39 -0.0072Q+0.0000087Q2 ○ 1.39 -0.0036Q+0.0000029Q² 1.39+0.0066Q+0.0000029Q² 1.24+0.0033Q+0.0000029Q2 For a plant size equal to 150,000 kilowatts, what is the output level that minimizes short-run average variable costs? year million kWh per At the output level thus obtained, the short-run average variable cost is per kWh. pence per kWh and the short-run marginal cost is pence
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