2. Mr. Juarez produce widgets. Currently, Mr. Juarez produces 4 widgets at a total cost of $50.a. What is Mr. Juarez's average total cost?b. Suppose Mr. Juarez could produce one more (the 5 widget) at a marginal cost of $5. If Mr. Juarezproduces that 5™ widget, what will his average total cost be? Has his average total cost increased ordecreased?c. Suppose instead that Mr. Juarez could produce one more (the 5h widget) at a marginal cost of $20. IfMr. Juarez produces that 5th widget, what will his average total cost be? Has his average total costincreased or decreased?

Average total cost is calculated by dividing total cost by quantity. Average total cost =(Total cost…

Answered: Mr. Juarez produce widgets. Currently,…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

A movie club charges a one-time membership f $25. It allows members to purchase movies for each. Another club does not charge a membersh fee and sells movies for $12 each. How many mc must a member purchase for the total cost of th two clubs to be equal?
4.4 Older oil wells that produce fewer than 10 barrels of oil a day are called “stripper" wells. Suppose that you and a partner own a stripper well that can produce 8 barrels of oil per day, and you estimate that the marginal cost of producing another barrel of oil is $80. In making your calculation, you take into account the cost of labor, materials, and other inputs that increase when you produce more oil. Your partner looks over your calculation of marginal cost and says: “You forgot about that bank loan we received two years ago. If we take into account the amount we pay on that loan, it adds $10 per barrel to our marginal cost of production." Briefly explain whether you agree with your partner's analysis.
What economic principle explains why average variable costs and marginal costs initialy decrease as output increases?
Fill in the following cost table. For the first few rows, you can work from left to right. However, as you get to the last two rows, you will need to use the information from the right side of the table to work back to the left side. We do not calculate average costs at a quantity of 0. Q TFC TVC TC AFC AVC ATC MC 0 5,000 0 XXXXXX XXXXXX XXXXXX XXXXXX 1 3.000 3,000 2 5,000 3 11,000 4 3,250 5 4,000 Can you tell if this is the short run or long run? Can you tell which level of output yields the highest profit? If so, what is the output level? If not, explain. Economists define the “Break-even Price” as the lowest point on the average total cost curve or the lowest average total cost given in a table. What is the break-even price in this problem? Economists define the “Shutdown Price” as the…
16. The total cost to make q quilts is C(q) = 73 +1.2q +0.05q2. a. What is a function for the marginal cost? b. Find a quantity that minimizes the average cost.
a. Calculate marginal cost using the formula given in the chapter: ATotal cost/AQuantity. Quantity Variable cost ($) Total cost ($) Marginal cost ($) 0 0 100 1 60 160 2 110 210 100 3 180 280 100 4 270 370 100 5 400 500 100 b. Calculate AVariable cost/AQuantity. Quantity Variable cost ($) AVariable cost Total cost ($) ($)/ AQuantity 0 0 100 1 60 160 100 2 110 210 100 3 180 280 100 4 270 370 100 5 400 500 100
The president of Toyota's Georgetown plant was quoted as saying, "Demand for high volumes saps your energy. Over a period of time, it eroded our focus (and] thinned out the expertise and knowledge we painstakingly built up over the years." Based on this quote, what must be true of the plant's average cost of production curve? A) It is U-shaped. 9 It is a ray from the origin. B) It is upward-sloping. D) It is downward-sloping.
Sea lions have been depleting the stock of steelhead trout. One idea to scare sea lions off the Washington state coast was to launch fake killer whales, predators of sea lions. The cost of making the first whale is $25,000—$7,000 for materials and $18,000 for the mold. The mold can be reused to make additional whales, so additional whales would cost $7,000 apiece.a. Calculate the total cost and average total cost of producing 1 to 10 fake killer whales by filling in the table below.Instructions: Enter your responses rounded to the nearest whole number. Quantity Total Costsof Mold ($) Total Costsof Materials ($) Total Costs($) Average Total Costs ($) 1 18,000 7,000 25,000 2 3 4 5 6 7 8 9 10 b. Does production of fake whales exhibit diseconomies of scale, economies of scale, or constant returns to scale? Diseconomies of scale Constant returns to scale Economies of…
Vinnie’s Painting Company specializes in painting houses. Their cost schedule is as follows:Output TFC TVC TC AFC AVC ATC MC 0. 10001. 1002. 1003. 4004. 4505. 16006. 32007 6400 A) Given the partial data available, finish the table and calculate all the costs. B)What is the minimum efficient scale of Vinnie’s company?C)What is the marginal cost of 6 houses?D)If Vinnie charges $825 per house, how many houses he should paint to maximize profit
At Emory's Pens and Pencils when they produce 50 pens their total cost is $80. Emory's marginal cost to produce the 51st pen is $1. What is the average total cost of producing 51 pens?
The cost curve for producing widgets passes through the following points and is piecewise linear in between. Solve, a. What is the fixed cost of producing 600 widgets? b. What is the variable cost of producing 600 widgets? c. What is the cost per unit if only 400 widgets are produced?
The cost information in the following table shows that as production increases Quantity produced/day Total cost Variable cost 0 $50 0 1 $75 $50 2 $110 $75 3 $155 $100 4 $210 $150 5 $270 $175 6 $345 $250 A.) variable cost increases at a uniform rate. b.) variable cost increases and then eventually falls c.) average total cost always falls d.) marginal cost eventually increases

SEE MORE QUESTIONS

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press

Principles of Economics (12th Edition)

Economics

ISBN:

9780134078779

Author:

Karl E. Case, Ray C. Fair, Sharon E. Oster

Publisher:

PEARSON

Engineering Economy (17th Edition)

Economics

ISBN:

9780134870069

Author:

William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

Publisher:

PEARSON

Principles of Economics (MindTap Course List)

Economics

ISBN:

9781305585126

Author:

N. Gregory Mankiw

Publisher:

Cengage Learning

Managerial Economics: A Problem Solving Approach

Economics

ISBN:

9781337106665

Author:

Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:

Cengage Learning

Managerial Economics & Business Strategy (Mcgraw-…

Economics

ISBN:

9781259290619

Author:

Michael Baye, Jeff Prince

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS