**Q:** At which point does the SMC curve cut the SAC curve? Give reason in support of your answer.### Explanation:The image contains a question about economic cost curves. When studying cost curves in microeconomics:- **SMC (Short-run Marginal Cost) Curve:** This curve represents the additional cost of producing one more unit of output in the short run. - **SAC (Short-run Average Cost) Curve:** This curve shows the average cost per unit of output in the short run.### Intersection Point:The SMC curve cuts the SAC curve at its minimum point. This occurs because when the marginal cost is below the average cost, the average cost is decreasing. Conversely, when the marginal cost is above the average cost, the average cost is increasing. Therefore, the SMC curve intersects the SAC curve at the lowest point of the SAC, indicating the most efficient scale of production in the short run.Understanding these intersection points is crucial for firms aiming to minimize costs and optimize production efficiency.

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Answered: Q: At which point does the SMC curve…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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please do not copy and paste from internet, thanks
Consider the following short-run, closed economy model of the economy. Goods Market C = 50 + 0.5(Y – T) I = 150 – 10r ; NX = -200 G = 150 ; T = 100 Money Market M = 20,000 P = 100 L(Y, r) = Y – 50r 1. Find the equilibrium values of r and y. *** This has been answered*** Goods Market = 600 - 20r Money Market = 200 + 50r equilibrium value of r = 5.71; Y = 485.8 2. Assume the natural rate of output is Y̅ = 210, individuals do not hold currency (cr = 0), and the reserve requirement is 10% (rr = 0.1). If the Fed desires to return the economy to its natural level, what should they do with reserves (R) and the money supply (M)? What is the new equilibrium real interest rate?
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Answer the given question with a proper explanation and step-by-step solution. the value of a is 1334

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Q: At which point does the SMC curve cut the SAC curve? Give reason in support of your answer.