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 29RQ
Why will firms in most markets be located at or close to the bottom of the long-run avenge cost me?
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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
- Round off your final answer to whole #. A company produces and sells a consumer product and is able to control the demand by varying the selling price. The approximate relationship between price and demand is 2700 5,000 p=47+ -forD>1 D D² The company is seeking to maximize its profit. The fixed cost is $1,000 and the variable cost is $39 per unit. What is the number of units that should be produced and sold each month to maximize profit?arrow_forwardM7arrow_forwardIf the firm wants to sell 70 units as a block and not individually, what price will the firm charge for the block? Please show your calculations Note: The answer should be typed.arrow_forward
- An airline is selling tickets for a flight from London to Frankfurt. The price of an economy class ticket three months before the flight date was £30. The price of the same ticket one day before the flight is £300. Your friend, who knows you have studied Industrial Organization, asked you to explain why there’s this difference in price.arrow_forward"I know that it's the thing to do," insisted Pamela Kincaid, vice president of finance for Colgate Manufacturing. "If we are going to be competitive, we need to build this completely automated plant." "I'm not so sure," replied Bill Thomas, CEO of Colgate. "The savings from labor reductions and increased productivity are only $4 million per year. The price tag for this factory-and it's a small one-is $45 million. That gives a payback period of more than 11 years. That's a long time to put the company's money at risk." "Yeah, but you're overlooking the savings that we'll get from the increase in quality," interjected John Simpson, production manager. "With this system, we can decrease our waste and our rework time significantly. Those savings are worth another million dollars per year." "Another million will only cut the payback to about 9 years," retorted Bill. "Ron, you're the marketing manager-do you have any insights?" "Well, there are other factors to consider, such as service…arrow_forwardIf Redstone wishes to maximize its profit margin, how many units should it produce?arrow_forward
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