Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
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Question
Chapter 21, Problem 7WNG
To determine
Impact on marginal cost if the
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if the ATC curve is rising, does that mean the MC curve must lie above it? Explain.
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Explain why an increase in the price of an input must typically cause an increase in the long-run total cost of producing any particular level of output.
Chapter 21 Solutions
Economics (MindTap Course List)
Ch. 21.2 - Prob. 1STCh. 21.2 - Prob. 2STCh. 21.2 - Prob. 3STCh. 21.2 - Prob. 4STCh. 21.3 - Prob. 1STCh. 21.3 - Prob. 2STCh. 21.3 - Prob. 3STCh. 21.4 - Prob. 1STCh. 21.4 - Prob. 2STCh. 21.4 - Prob. 3ST
Ch. 21.4 - Prob. 4STCh. 21.5 - Prob. 1STCh. 21.5 - Prob. 2STCh. 21.5 - Prob. 3STCh. 21 - Prob. 1QPCh. 21 - Prob. 2QPCh. 21 - Prob. 3QPCh. 21 - Prob. 4QPCh. 21 - Prob. 5QPCh. 21 - Prob. 6QPCh. 21 - Prob. 7QPCh. 21 - Prob. 8QPCh. 21 - Prob. 9QPCh. 21 - Prob. 10QPCh. 21 - Prob. 11QPCh. 21 - Prob. 12QPCh. 21 - Prob. 13QPCh. 21 - Prob. 14QPCh. 21 - Prob. 15QPCh. 21 - Prob. 16QPCh. 21 - Prob. 17QPCh. 21 - Prob. 18QPCh. 21 - Prob. 19QPCh. 21 - Prob. 1WNGCh. 21 - Prob. 2WNGCh. 21 - Prob. 3WNGCh. 21 - Prob. 4WNGCh. 21 - Prob. 5WNGCh. 21 - Prob. 6WNGCh. 21 - Prob. 7WNGCh. 21 - Prob. 8WNGCh. 21 - Prob. 9WNG
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- Discuss why the long-run ATC curve is generally U-shapedarrow_forwardThe production of Hyundai has a function of Q=(L12+K12)2 a. Do the inputs exhibit diminishing marginal returns? b. Get the cross partials and check if they are equal.arrow_forwardIf a firm has economies of scale, it must have increasing returns to scale. True or false? PLEASE EXPLAIN IN DETAIL .arrow_forward
- true or false. please explain why.arrow_forwardA firm’s production function is given by q = min{M, L1/2}, where M is the number of machines and L is the amount of labor that it uses. The price of labor is $1and the price of machines is $2 per unit. a. Is this technology decreasing return to scale? Show your argument. b. Is it true the statement that if average production cost is increasing, a firm’s technology exhibits the decreasing return to scale. (If yes, show the proof. If not, show a counter example) c. Is it true that if a firm’s technology exhibits the decreasing return to scale, then average production cost is increasing? (If yes, show the proof. If not, show a counter example)arrow_forwardSuppose an automobile manufacturer is choosing between two production options. It can produce 100 cars with 200 workers and 50 machines, or it can produce 166 cars with 300 workers and 75 machines. Would you describe the manufacturer’s production function as exhibiting decreasing, constant, or increasing returns to scale? Explain.arrow_forward
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