Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 7, Problem 27RQ
What is the difference between economies of scale, constant returns to scale, and diseconomies of scale?
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Chapter 7 Solutions
Principles of Economics 2e
Ch. 7 - A firm had sales revenue of 1 million last year....Ch. 7 - Continuing from Exercise 7.1, the films factory...Ch. 7 - The WipeOut Ski Company manufactures skis for...Ch. 7 - Based on your answers to the WipeOut Ski Company...Ch. 7 - If two painters can paint 200 square feet of wall...Ch. 7 - Return to the problem explained in Table 7.13 and...Ch. 7 - Suppose the cost of machines increases to 55,...Ch. 7 - Automobile manufacturing is an industry subject to...Ch. 7 - What are explicit and implicit costs?Ch. 7 - Would you consider an interest payment on a loan...
Ch. 7 - What is die difference between accounting and...Ch. 7 - What is a production function?Ch. 7 - What is the difference between a fixed input and a...Ch. 7 - How do we calculate marginal product?Ch. 7 - What shapes would you generally expect a total...Ch. 7 - What are the factor payments for land, labor, and...Ch. 7 - What is the difference between fixed costs and...Ch. 7 - How do we calculate each of the following:...Ch. 7 - What shapes would you generally expect each of the...Ch. 7 - Are there fixed costs in the lung-run? Explain...Ch. 7 - Are fixed costs also sunk costs? Explain.Ch. 7 - What are diminishing marginal returns as they...Ch. 7 - Which costs are measured on per-unit basis: fixed...Ch. 7 - What is a production technology?Ch. 7 - In choosing a production technology, how will...Ch. 7 - What is a long-run average cost curve?Ch. 7 - What is the difference between economies of scale,...Ch. 7 - What shape of a long-run average cost curve...Ch. 7 - Why will firms in most markets be located at or...Ch. 7 - Small Mom and Pop firms, like inner city grocery...Ch. 7 - A common name for fixed cost is overhead. If you...Ch. 7 - How does fixed cost affect marginal cost? Why is...Ch. 7 - Average cost curves (except for avenge fixed cost)...Ch. 7 - What is the relationship between marginal product...Ch. 7 - It is clear that businesses operate in the short...Ch. 7 - Retune to Table 7.2. In the top half of the table,...Ch. 7 - How would an improvement in technology, like the...Ch. 7 - Do you think that the taxicab industry in large...Ch. 7 - A firm is considering an investment that will earn...Ch. 7 - Return to Figure 7.7. What is the marginal gain in...Ch. 7 - Compute the average total cost, average variable...Ch. 7 - A small company that shovels sidewalks and...
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Similar questions
- Distinguish between economies of scale and diseconomies of scale. Give examples of why a firm may experience economies of scale.arrow_forwardexplain with graphs the difference between economies of scale, economies of scope and returns to scale.arrow_forwarddescribe economies and diseconomies of scale while explaining possible reasons for both situations to occurarrow_forward
- Explain the general shape of the long run cost curves in relation to economies and diseconomies of scale.arrow_forwardBased on your own personal observations of the college, do you think the low-income Community College is experiencing economies of scale, diseconomies of scale, or constant returns to scale? Make certain to explain your answer.arrow_forwardDoes a relationship exist between increasing returns to scale and long-run average cost? Explain with the help of a graph. (need one-page text answer, not an image)arrow_forward
- A hospital provides emergency-room medical care for local residents. Suppose the hospital currently provides this care for 15,000 patients per year at a total cost of $60,000,000. If the hospital expands, it can provide emergency-room medical care for 20,000 patients per year at a total cost of $10,000,000. If the hospital expands, will it be experiencing economies of scale, diseconomies of scale, or constant returns to scale? If the hospital expands, it will be experiencing diseconomies of scale constant returns to scale economies of scalearrow_forwardHow could you explain the difference between economies of scope and economies of scale? Please explain, thank you!arrow_forwardDistinguish between economies of scale and constant returns to scale. What shape will the long-run average cost curve have for economies of scale and constant returns to scalearrow_forward
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