Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 14, Problem 3SPPA
To determine
Based on the case study, construct the total variable cost and total cost schedule. Calculate the difference between total cost and total variable cost at each output level and what does it show?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Solution sent me only typing
Construct the average fixed cost, average variable cost, and average total cost schedules and the marginal cost schedule.
Matt's birdhouse factory rents equipment for constructing birdhouses and hires students.
Matt pays $120 a day for equipment and $160 a day to each student he hires.
The two left columns of the table show Matt's total product schedule.
Calculate Matt's average fixed cost, average variable cost, average total cost, and marginal
cost and complete the table.
>>> Answer to 2 decimal places
Total Average Average Average
Labor product fixed variable total Marginal
cost
cost
cost
cost
(workers (houses
per day)
per day)
(dollars per house)
1
40
2
3
84
132
Chapter 14 Solutions
Foundations of Economics (8th Edition)
Knowledge Booster
Similar questions
- Peter's birdhouse factory rents equipment for constructing birdhouses and hires students. Peter pays $50 a day for equipment and $180 a day to each student he hires. The table shows Peter's total product schedule. Calculate Peter's average fixed cost, average variable cost, average total cost, and marginal cost and complete the table. >>> Answer to 2 decimal places. Total Labor product (workers (houses per day) per day) 1 45 2 3 99 162 Average Average Average fixed variable total cost cost cost (dollars per house Marginal cost (dollars per house)arrow_forwardComplete the following table, assumingthat each unit of labor costs $75 per day. a. Graph the fixed cost, variable cost, and total cost curves for these data.b. What is the marginal product of the third unit of labor?c. What is average total cost when output is 18 units per day?arrow_forwardBrenda's body board factory rents equipment for shaping boards and hires students. Brenda pays $150 a day for equipment and $160 a day to each student she hires. The two left columns of the table show Brenda's total product schedule. C... Calculate Brenda's average fixed cost, average variable cost, average total cost, and marginal cost and complete the table. >>> Answer to 2 decimal places. Total Labor product (workers (boards per day) per day) 1 28 2 3 64 108 Average Average Average fixed variable total Marginal cost cost cost cost (dollars per board)arrow_forward
- Marginal cost, average total cost and average variable cost Marginal cost and average total cost are always equal. Do you agree? Explain. If you disagree then write under what situation they are equal. b. Marginal cost and average variable cost are always equal. Do you agree? Explain. If you disagree then write under what situation they are equal.arrow_forwardGraph the following: Average Total Cost curve and Average Variable Cost curve with proper positioningarrow_forwardThe government imposes a $1000 per year license fee on all pizza restaurants. As a result, which cost curves shift? average total cost and average fixed cost average total cost and marginal cost average variable cost and marginal cost O average variable cost and average fixed costarrow_forward
- Construct Len’s total variable cost and total cost schedules. What does the difference between total cost and total variable cost at each output equal?arrow_forwardWhat is the shape of the average variable and average total cost curves and average fixed cost? Explain the reason for these shapes. Why is long run average cost curve known as envelope curve? Answer in 1000 wordsarrow_forwardUse the following table to answer the questions that follow. Total Output Cost TFC TVC AFC AVC ATC MC0 $20 1 $40 2 $60 3 $90 4 $120 5 $180 6 $280 a. Calculate the total fixed costs, total variable costs, average fixed costs, average variable costs, average total costs, and marginal costs b. Plot each of the cost curves. c. At what quantity of output does marginal cost equalaverage total cost and average variable cost?arrow_forward
- You work at Cooper's Millworks, which makes tables, chairs, doors, etc. Here is a partial table showing the costs of making 1, 2, or 3 tables per day. Four values are missing: A, B, C, D. What is the missing value A? Tables Made Daily Marginal Cost 1 250 2 220 3 190 Answer: Total Cost 250 A C Average Cost 250 B Darrow_forwardPlease make sure to answer part Carrow_forwardThe Santa Clara County increases the property taxes for all fast food restaurants. Which cost curves will be affected as a result of this policy? 1. average total cost and average fixed cost. 2. average variable cost and average total cost. 3. average variable cost and marginal cost. 4. average variable cost and average fixed cost.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning