Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Chapter 21, Problem 15CQ
To determine
The problem of shirking.
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What is price taker meaning?
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a.What does shirking (goofing off) mean for firms and why is it a problem?
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Chapter 21 Solutions
Economics: Private and Public Choice (MindTap Course List)
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- explain why a firm might want to produce its good even after diminishing marginal returns have set in and marginal cost is rising ?arrow_forwardExplain what it means in terms of opportunity cost when Economic profits are zero?arrow_forwardAccording to W. Gillepse, "A minimum of expenses is of course, highly desirable; but the road which is truly the cheapest is not the one which has cost the least money, but the one which makes the most profitable returns in proportion to the amount expended upon it." Explain the quote based on his economic views.arrow_forward
- Suppose Mr. Mohammed, a seller in the Fruit & Vegetable Market in Al-Aweer, suddenlyrealized that his marginal cost was below the market price of the output. How would he reactif he were a profit maximizer? Analyze.arrow_forwardSuppose that a farm manager seeks to maximize its total profit function a s given by the equation, profit =80x-2x^2-xy-3y^2+100y. let x=cabbages and y= onions. but the manager faces a constrain that the sum of the cabbages and onions must be equal to 12.a. Calculate the level of output at which the farm maximizes profitb. Calculate the farms profit.c. Comment on the farms performance.arrow_forwardUse the following image to answer the questions: The first is a (human) worker, who must be paid $18 for each hour they spend producing chairs. The second is a robot, that costs $15 of inputs (including electricity and maintenance) for each hour it works. Assume that the sale price of chairs is always sufficiently high that it is profitable to fulfill this 80-chair order. The firm needs to make 80 chairs to fulfill its order. Assume also that the firm is profit maximizing (& therefore cost minimizing). 1) What combinations of robot and worker hours must they use to minimize costs? Show your work. Please Use the equation that must be true for cost minimization pls show full calculationsarrow_forward
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