TRUE or FALSE and explain your answer fully If the cost of production is minimized, then all inputs that are used must have the same marginal productivity.

Q: Give an example of a Cobb–Douglas production function.What is the marginal productivity of labor? Of…

A: A Cobb-Douglas PF (production function) is homogeneous and homothetic in nature, which means the…

Q: Complete the following table and answer the short discussion question. Average Cost (AC) Average…

A: In economics, TFC is the cost incurred when the output production is zero; therefore, here, TFC is…

Q: Distinguish implicit and explicit cost of production give an example for each?

A: Explicit costs are out-of-pocket expenses. Implicit cost is the opportunity cost.

Q: Q 4. ( A) Consider the following production functions: are products and xy is the use of input i in…

A: We are given 2 production functions, where input x is used in producing both Y1  and Y2  Y1= 2x1 Y2=…

Q: Consider the factors of production that go intoa fast-food restaurant. Give an example of…

A: Factors of production are regarded as the building blocks as they are essential for the production…

Q: A firm has access to two production processes with the following marginal cost curves: MC1 = 0.25x…

A: Given: Production processes with marginal cost curves: MC1 = 0.25x and MC2 = 6+0.1y Total Output…

Q: At what level of production does the marginal cost have the least value? What is the marginal cost…

A: The marginal cost curve is the U-shaped curve.

Q: Yj-2x11 Y2=3x12 Q 4. ( A) Consider the following production functions: y2 are products and xj is the…

A: Given information Y1=2X11 Y2=2X12 Y are the products X are inputs Total use of X= 1/2Y1+1/3 Y2

Q: Consider the table below that describes the costs associated with producing a good (Q). Total…

A: Marginal cost refers to the additional cost of producing one more unit of output.

Q: A firm has access to two production processes with the following marginal cost curves: MC1 = 0.25x…

A: If a firm wants to minimize the cost of production when it distributes its total production between…

Q: Give one example of external economics of scale?

A: According to the given question Simply we can state that the external economy are those economies…

Q: Suppose that widgets can be produced using two different production techniques . A and B. The…

A:

Q: You sell homemade candles online for $50 each and you hire your family members to make the candles.…

A: Break even quantity is the quantity at which total revenue = total cost. Where total revenue = 50q

Q: Given the following production function Y=X+4X^2-0.2X^3. At what level of X does the marginal…

A: Y=-0.2X3+4X2+X MPP = dYdX=d(-0.2X3+4X2+X)dX=-0.6X2+8X+1   For MPP to be maximum, dY/dX = 0…

Q: 35) What is the firm’s efficient scale?  A. the quantity of output that minimizes average total…

A: (35)  A firm's efficient scale implies the production of output such that it minimizes the average…

Q: Consider the marginal cost curve associated with cleaning your dorm room. Label the vertical axis…

A: Marginal cost is addition to the total cost caused by producing one more unit of output.

Q: What explains the shape of the average and marginal cost curves?  Is it linked to any production…

A: Marginal cost is the measurement of change in total cost with the increment of quantity produced by…

Q: Diminishing Marginal Returns” is achieved when?

A: The law of diminishing marginal returns states that adding an extra factor of production ends up in…

Q: Marginal Efficiency of Capital" is best explained how?

A: Marginal efficiency of capital is the expected rate of return on investment at a particular level of…

Q: A fast-food company spends millions of dollars to develop and promote a new hamburger on its menu…

A: The sunk costs are the expenditure incurred by a firm or business that is non-recoverable or on…

Q: Distinguish between explicit and implicit costs, giving examples of each. Why does the economist…

A: Externalities: It occurs in the economy when the production of goods and services and the…

Q: Is it possible to avoid Diminishing Marginal Return? Why? Explain

A: Law of diminishing returns postulates that as more units of a variable input are used with a fixed…

Q: What must an entrepreneur do to earn a profit? How do the actions of firms earning profits influence…

A: An entrepreneur should always remember that its revenue should be higher than its cost in order to…

Q: If a good is labour intensive it means that no capital is used in the manufacturing of that good.…

A: The statement is false

Q: How does rising organic composition of capital threaten the rate of profit?

A: Historically, there have been a lot of economic theories stating the requirements for the…

Q: Consider the table below that describes the costs associated with producing a good (Q). Q Total…

A: Marginal cost of Q is equals to TC (Q) - TC(Q-1) So, MC(Q=2) = TC(Q=2) - TC(Q=1)

Q: What is economies of scale? What are differences between internal and external economies of scale?

A: Economies of Scale: When a company expands its production then usually the cost per unit falls.…

Q: How could this be possible? What is Mrs. Bill assuming about the output range in which Bill is…

A: Initially, Buffalo Bill is at a loss on every packet of Buffalo's chips he sells. On the…

Q: Alec and Ellie are the only detectives in the town of Broadchurch. They work together. Assume…

A: In this question we have to find out the additional paperwork files to be given up with the help of…

Q: What must an entrepreneur do to earn a profit? How do theactions of firms earning profits influence…

A: Profits are important as they show how productive a company's activities are. Furthermore, profits…

Q: If a paper mill shuts down its operations for three months so that it produces nothing, its will be…

A: Variable cost Variable expenses are volume-related and alter as production levels change. Raw…

Q: When thinking about cost analysis in Microeconomics, what are the real-world problems that occur…

A: Economies of scale are cost savings that can arise when a business expands the production scale and…

Q: QUESTION 2 Match each of the following terms and descriptions Explicit Cost A. the opportunity cost…

A: There are two type of cost- implicit cost and explicit cost. Explicit cost includes payment of money…

Q: Consider the table below that describes the costs associated with producing a good (Q). Q Total…

A: Average total cost is the total cost divided by units of output.

Q: Using examples, explain ways in which the Production function has evolved

A: A production function is a mathematical tool that can be used to study the relationship between…

Q: The law if diminishing marginal returns is the rate at which one input maybe substituted for another…

A: The law of diminishing marginal returns is not the rate of substitution of one input for another…

Q: A firm has access to two production processes with the following marginal cost curves: MC1 = 0.25x…

A: A firm minimizes costs when it distributes production across the two process so that marginal cost…

Q: What emphasis, if any, should be placed on lean production?

A: Lean production is a concept of doing business in which the aim is minimization of resources and…

Q: Complete the following table and answer the short discussion question Marginal Cost (MC) Total…

A: The total fixed cost (TFC) is the cost incurred when the output production is zero. Therefore, at…

Q: Discuss about the concept of marginal cost using your own example?

A: Meaning of Cost: The term cost refers to the situation under which a firm occurs various expenses…

Q: In the short run, if a firm chooses to operate and produce output, it must be the case that

A: The shutdown point of a firm comes when the price of the goods sold is less than the variable cost…

Q: Explain why marginal costs increase above some level of production in the short run.

A: The marginal cost is the additional cost incurred from producing one additional unit of goods and…

Q: You own a coffee shop and use both labor and capital to make lattes. Currently, the marginal product…

A: Input combination is efficient when Marginal product of labor / Price of labor = Marginal product of…

Cost of Production

In economic theory, production costs are the costs incurred by an industrial organization when it engineers a project or provides a service that generates revenue and benefits. Labor costs, raw materials, consumable manufacturing costs, and general overhead sum up, accounting for production costs. Total cost data is calculated by combining total direct costs of materials, labor costs, and total production costs.