You are a newspaper publisher. You are in the middle of a one-year rental contract for your factory that requires you to pay $700,000 per month, and you have contractual labor obligations of $1,250,000 per month that you can't get out of. You also have a marginal printing cost of $0.35 per paper as well as a marginal delivery cost of $0.10 per paper. Instructions: Round your answers to 2 decimal places. a. If sales fall by 20 percent from 1,000,000 papers per month to 800,000 papers per month, what happens to the AFC per paper? It Trises from per paper to 2$ 1.88 per paper. b. What happens to the MC per paper? MC does not change

You are a newspaper publisher. You are in the middle of a one-year rental contract for your factory that requires you to pay $700,000 per month, and you have contractual labor obligations of $1,250,000 per month that you can't get out of. You also have a marginal printing cost of $0.35 per paper as well as a marginal delivery cost of $0.10 per paper. Instructions: Round your answers to 2 decimal places. a. If sales fall by 20 percent from 1,000,000 papers per month to 800,000 papers per month, what happens to the AFC per paper? It Trises from per paper to 2$ 1.88 per paper. b. What happens to the MC per paper? MC does not change

Microeconomics: Principles & Policy

14th Edition

ISBN:9781337794992

Author:William J. Baumol, Alan S. Blinder, John L. Solow

Publisher:William J. Baumol, Alan S. Blinder, John L. Solow

Chapter7: Production, Inputs, And Cost: Building Blocks For Supply Analysis

Section: Chapter Questions

Problem 9TY

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You are a newspaper publisher. You are in the middle of a one-year rental contract for your factory that requires you to pay $600,000 per month, and you have contractual labor obligations of $1,250,000 per month that you can’t get out of. You also have a marginal printing cost of $0.35 per paper as well as a marginal delivery cost of $0.10 per paper. Instructions: Round your answers to 2 decimal places. c. What happens to the minimum amount that you must charge to break even on these costs? It increases from $...........per paper to $2.76. what is the price for paper?
You are a newspaper publisher. You are in the middle of a one-year factory rental contract that requires you to pay $500,000 per month, and you have contractual salary obligations of $1,250,000 per month that you can't get out of. You also have a marginal printing cost of $0.25 per paper as well as a marginal delivery cost of $0.10 per paper. Instructions: Enter your answers rounded to two decimal places. a. If sales fall by 20 percent from 1,000,000 newspapers per month to 800,000 newspapers per month, what happens to the AFC per newspaper? AFC per newspaper (Click to select) v from $ to $ b. What happens to the MC per newspaper? MC per newspaper (Click to select) v c. What happens to the minimum amount that you must charge to break even? It (Click to select) v from $ to $
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Let's explore how rising costs helped to kill off most printed newspapers after the Internet became available in the mid-1990s. Imagine that you are a newspaper publisher in the year 2004. You are in the middle of a one-year factory rental contract that requires you to pay $700,000 per month, and you have contractual salary obligations of $1,250,000 per month that you can't get out of. You also have a marginal printing cost of $0.25 per paper as well as a marginal delivery cost of $0.10 per paper. Instructions: Enter your answers rounded to two decimal places. a. If sales fall by 20 percent from 1,000,000 newspapers per month to 800,000 newspapers per month, what happens to the AFC per newspaper? AFC per newspaper rises from $ to $ b. What happens to the MC per newspaper? MC per newspaper does not change c. What happens to the minimum amount that you must charge to break even? It rises from $ to $
Let's explore how rising costs helped to kill off most printed newspapers after the Internet became available in the mid-1990s. Imagine that you are a newspaper publisher in the year 2004. You are in the middle of a one-year factory rental contract that requires you to pay $700,000 per month, and you have contractual salary obligations of $1,250,000 per month that you can't get out of. You also have a marginal printing cost of $0.35 per paper as well as a marginal delivery cost of $0.10 per paper. Instructions: Enter your answers rounded to two decimal places. a. If sales fall by 20 percent from 1,000,000 newspapers per month to 800,000 newspapers per month, what happens to the AFC per newspaper? AFC per newspaper (Click to select) : from $ b. What happens to the MC per newspaper? MC per newspaper (Click to select) ÷ c. What happens to the minimum amount that you must charge to break even? It (Click to select) : from $ to $
You are an employer seeking to fill a vacant position on an assembly line. Are you more concerned with the average product of labor or the marginal product of labor for the last person hired?
Let's assume that a firm's total weekly costs are as follows: 1. Salaries = $5000. 2. Supplies = $1000. 3. Rent = $600. In addition, the owners have invested $30,000 of their own money into the business. This could have earned them interest of $100 per week if they had chosen to put it into a bank instead of investing it into their business. If the firm has weekly revenue of $20,000, the firm's accounting profit is ____________, and the economic profit is _____________. Loss of $18,987; profit of $5,690 Loss of $16,600; loss of $16,700. Loss of $16,700; loss of $16,600. $13,300; $13,400. $13,400; $13,300.
Kevin quits his computer programming job, where he was earning a salary of $60,000 per year, to start his own computer software business in a building that he owns and was previously renting out for $24,000 per year. In his first year of business, he has the following expenses: salary paid to himself, $40,000; rent, $0; other actual expenses, $25,000. Calculate the accounting cost and the economic cost associated with Kevin’s computer software business. If Kevin’s total revenue for the first year was $70,000 how much revenue would his business need to generate to earn positive economic profit? Explain briefly.
Suppose for a particular firm the only variable input into the production process is labor, and that output equals zero when no workers are hired. If the average total cost (ATC) is $30 when 5 units of output are produced, and if marginal cost (MC) of the 6th unit of output is $60, what’s the average total cost (ATC) for 6 units of output?
If You are the owner and only employee of a company that writes computer software that is used by gamblers to collect sports data. Last year you earned a total revenue of $90,000. Your costs for equipment, rent, and supplies were $60,000. To start this business you invested an amount of your own capital that could pay you a return of $40,000 a year. then your economic costs are: Select one: a. 60,000 b. 10,000 O c. 100,000 O d. 40,000 O e. 90,000
Suppose that in the short-run (Labor is the only variable input) when output equals 50, (1) the firm uses 5 workers and pays them a wage $40 and (2) total fixed costs equal $200. Which of the following is NOT correct? Total Variable Cost (TVC)= $200 Average Variable Cost (AVC) = $4 O Average Fixed Cost (AFC) = $8 O Average Total Cost (ATC) = $8