Problem 15-02 (algo) ADVANCED ANALYSIS A firm faces the following costs: total cost of capital = $2,500; price paid for labor = $14 per labor unit; and price paid for raw materials = $5 per raw-material unit. Instructions: In parts a and b, enter your answers for total cost as a whole number. Round your answers for average total cost to 2 decimal places. In part c, enter your answer as a whole number. a. Suppose the firm can produce 6,500 units of output this year by combining its fixed capital with 100 units of labor and 450 units of raw materials. What are the total cost and average total cost of producing the 6,500 units of output? TC=$ ATC=$1 b. Now assume the firm improves its production process so that it can produce 7,250 units of output this year by combining its fixed capital with 100 units of labor and 450 units of raw materials. What are the total cost and average total cost of producing the 7,250 units of output? TC=$ ATC=$ c. If units of output can always be sold for $1 each, then by how much does the firm's profit increase after it improves its production process? $
Problem 15-02 (algo) ADVANCED ANALYSIS A firm faces the following costs: total cost of capital = $2,500; price paid for labor = $14 per labor unit; and price paid for raw materials = $5 per raw-material unit. Instructions: In parts a and b, enter your answers for total cost as a whole number. Round your answers for average total cost to 2 decimal places. In part c, enter your answer as a whole number. a. Suppose the firm can produce 6,500 units of output this year by combining its fixed capital with 100 units of labor and 450 units of raw materials. What are the total cost and average total cost of producing the 6,500 units of output? TC=$ ATC=$1 b. Now assume the firm improves its production process so that it can produce 7,250 units of output this year by combining its fixed capital with 100 units of labor and 450 units of raw materials. What are the total cost and average total cost of producing the 7,250 units of output? TC=$ ATC=$ c. If units of output can always be sold for $1 each, then by how much does the firm's profit increase after it improves its production process? $
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter12: The Cost Of Production
Section: Chapter Questions
Problem 3CQQ
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Graw
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7
Problem 15-02 (algo)
BO
price paid for raw materials = $5 per raw-material unit.
ADVANCED ANALYSIS A firm faces the following costs: total cost of capital = $2,500; price paid for labor = $14 per labor unit; and
decimal places. In part c, enter your answer as a whole number.
Instructions: In parts a and b, enter your answers for total cost as a whole number. Round your answers for average total cost to 2
a. Suppose the firm can produce 6,500 units of output this year by combining its fixed capital with 100 units of labor and 450 units of
raw materials. What are the total cost and average total cost of producing the 6,500 units of output?
TC = $
ATC=$
Q
b. Now assume the firm improves its production process so that it can produce 7,250 units of output this year by combining its fixed
units of output?
capital with 100 units of labor and 450 units of raw materials. What are the total cost and average total cost of producing the 7,250
TC=$
ATC=$
process?
c. If units of output can always be sold for $1 each, then by how much does the firm's profit increase after it improves its production
ess Schol....docx
$
this year's profit, would the firm implement the improved production process?
d. Suppose that implementing the improved production process would require a one-time-only cost of $850. If the firm considers only
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What if the firm considers its profit not just this year but in future years as well?
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Transcribed Image Text:nces
Mc
Graw
Hill
7
Problem 15-02 (algo)
BO
price paid for raw materials = $5 per raw-material unit.
ADVANCED ANALYSIS A firm faces the following costs: total cost of capital = $2,500; price paid for labor = $14 per labor unit; and
decimal places. In part c, enter your answer as a whole number.
Instructions: In parts a and b, enter your answers for total cost as a whole number. Round your answers for average total cost to 2
a. Suppose the firm can produce 6,500 units of output this year by combining its fixed capital with 100 units of labor and 450 units of
raw materials. What are the total cost and average total cost of producing the 6,500 units of output?
TC = $
ATC=$
Q
b. Now assume the firm improves its production process so that it can produce 7,250 units of output this year by combining its fixed
units of output?
capital with 100 units of labor and 450 units of raw materials. What are the total cost and average total cost of producing the 7,250
TC=$
ATC=$
process?
c. If units of output can always be sold for $1 each, then by how much does the firm's profit increase after it improves its production
ess Schol....docx
$
this year's profit, would the firm implement the improved production process?
d. Suppose that implementing the improved production process would require a one-time-only cost of $850. If the firm considers only
(Click to select) v
What if the firm considers its profit not just this year but in future years as well?
(Click to select)
:0
F1
2
100
W
Aquaponics.jpeg
F2
3
13
E
20
F3
MAR
<
$
4
F4
R
aquaponic title.jpeg
26
%
5
tv J
F5
< Prev
T
<6
12 of 12
NIEZA
F6
Y
J 20
7
♡
Next >
F7
U
X
DII
8
F8
W
z
9
F9
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