Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.?AVERAGE TOTAL COST (Dolars per scooter)800720640560400320100100 200 300400 500QUANTITY (Scooters)600 700RangeMore than 400 scooters per monthFewer than 300 scooters per monthBetween 300 and 400 scooters per monthSRATCSRATC-0-SRATC,LRATCIn the following table, indicate whether the long-run average cost curve exhibits economies of scale, constant returns to scale, or diseconomies of scalefor each range of scooter production.Economies of Scale Constant Returns to ScaleDiseconomies of Scale 5. Costs in the short run versus in the long runScooter's Scooters is a large American manufacturer of electric scooters operating out of Lansing. Currently, the company produces all of its scootersusing a single manufacturing facility, its factory in town. Recently, management has been considering expanding operations to one or two additionalfactories. The following table presents the manufacturer's monthly short-run average total cost (SRATC) for various levels of production if it operates outof one, two, or three factories. (Note: Q equals the total quantity of scooters produced by all factories.)Number of Factories123Q = 100 Q = 200360200540300720400Average Total Cost(Dollars per scooter)Q = 300 Q = 400160160240240160160Q = 500400300200Q = 600720540360per scooterSuppose Scooter's Scooters is currently producing 600 scooters per month in its only factory. Its short-run average total cost is sSuppose Scooter's Scooters is expecting to produce 600 scooters per month for several years. In this case, in the long run, it would choose to producescooters usingOn the following graph, plot the three SRATC curves for Scooter's Scooters from the previous table. Specifically, use the green points (triangle symbol) toplot its SRATC curve if it operates one factory (SRATC, ); use the purple points (diamond symbol) to plot s SRATC curve if it operates two factories (SRATC,); and use the orange points (square symbol) to plot its SRATC curve if it operates three factories (SRATC). Finally, plot the long-run averagetotal cost (LRATC) curve for Scooter's Scooters using the blue points (circle symbol),Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.

There is a scooter manufacturing company, Scooter's Scooter. Initially, it had only one factory to…

Scooter's Scooters is a large American manufacturer of electric scooters operating out of Lansing. Currently, the company produces all of its scooters using a single manufacturing facility, Its factory in town. Recently, management has been considering expanding operations to one or two additional factories. The following table presents the manufacturer's monthly short-run average total cost (SRATC) for various levels of production if it operates out

Scooter's Scooters is a large American manufacturer of electric scooters operating out of Lansing. Currently, the company produces all of its scooters using a single manufacturing facility, Its factory in town. Recently, management has been considering expanding operations to one or two additional factories. The following table presents the manufacturer's monthly short-run average total cost (SRATC) for various levels of production if it operates out

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

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Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.
?
AVERAGE TOTAL COST (Dolars per scooter)
800
720
640
560
400
320
100
100 200 300
400 500
QUANTITY (Scooters)
600 700
Range
More than 400 scooters per month
Fewer than 300 scooters per month
Between 300 and 400 scooters per month
SRATC
SRATC
-0-
SRATC,
LRATC
In the following table, indicate whether the long-run average cost curve exhibits economies of scale, constant returns to scale, or diseconomies of scale
for each range of scooter production.
Economies of Scale Constant Returns to Scale
Diseconomies of Scale

5. Costs in the short run versus in the long run
Scooter's Scooters is a large American manufacturer of electric scooters operating out of Lansing. Currently, the company produces all of its scooters
using a single manufacturing facility, its factory in town. Recently, management has been considering expanding operations to one or two additional
factories. The following table presents the manufacturer's monthly short-run average total cost (SRATC) for various levels of production if it operates out
of one, two, or three factories. (Note: Q equals the total quantity of scooters produced by all factories.)
Number of Factories
1
2
3
Q = 100 Q = 200
360
200
540
300
720
400
Average Total Cost
(Dollars per scooter)
Q = 300 Q = 400
160
160
240
240
160
160
Q = 500
400
300
200
Q = 600
720
540
360
per scooter
Suppose Scooter's Scooters is currently producing 600 scooters per month in its only factory. Its short-run average total cost is s
Suppose Scooter's Scooters is expecting to produce 600 scooters per month for several years. In this case, in the long run, it would choose to produce
scooters using
On the following graph, plot the three SRATC curves for Scooter's Scooters from the previous table. Specifically, use the green points (triangle symbol) to
plot its SRATC curve if it operates one factory (SRATC, ); use the purple points (diamond symbol) to plot s SRATC curve if it operates two factories (
SRATC,); and use the orange points (square symbol) to plot its SRATC curve if it operates three factories (SRATC). Finally, plot the long-run average
total cost (LRATC) curve for Scooter's Scooters using the blue points (circle symbol),
Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.

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