Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134078779
Author: Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 8, Problem 2.6P
(a)
To determine
The marginal cost and the total cost curve of the firm.
(b)
To determine
The quantity of output, the total revenue, total cost and total profit.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
A firm had sales revenue of $942 million last year.
It spent $463 million on labor, $88 million on
capital and $162 million on materials. The firm's
factory sits on land owned by the firm that could
be rented out for $2 million per year. What was the
firm's economic profit last year in millions of
dollars? (Do not include the word "million" or the
dollar symbol in your answer, just a number.)
help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working
Mike spends RM35,000 per annum on painting supplies and storage space. He recently received two job offers from a famous marketing firm – one offer was for RM 95,000 per year, and the other was for RM 105,000. However, he turned both jobs down to continue a painting career. If Mike sells 20 paintings per year at a price of RM 8,000 each:
Question 1: What are his accounting profits?
Question 2: What are his economic profits?
Chapter 8 Solutions
Principles of Economics (12th Edition)
Knowledge Booster
Similar questions
- "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_forwardUse the table below to answer the next three questions. The below table displays the production schedule for Great Balls of Fire, a food truck that sells flaming meatballs. Great Balls of Fire has a lease on the truck itself that costs $1200 per week that must be paid whether or not the food truck produces and sells any meatballs. They may hire up to three workers to produce and sell the meatballs, workers cost $600 per week. The production schedule shows you how many meatballs would be produced with the varying levels of employees. Employees Meatballs Fixed Costs Variable Cost Total Cost Average Variab Cost 0 0 0 1 300 2 500 3 600 Completely fill out the table, please round all answers to the nearest cent. Do not enter any commas, dollar signs, or units (Ex. If your calculator says 12.376, just enter 12.38.) If your answer is an even dollar amount, you don't need to include the cents (Ex. you may enter 10 instead of 10.00)arrow_forwardCan you just answer the question from the firm project I create in the first picturearrow_forward
- Our firm produces two products: generators and solar panels. Name five economies of scale you would expect our company to leverage and explain how you would expect the company to leverage them.arrow_forwardRafael quit his job paying him $74,000 per year to be a consultant. Last year he started a business for which he spent $7,000 on Google and Facebook advertisements and paid himself $75,000. Based on this information, what were his economic cost of this new business?arrow_forwardQuestion 5 of 16 Sandra's company has a machine that can produce a maximum of 45,000 components per annum. She sells each component for $5.30. The fixed costs are $35,000 per annum and variable costs are $0.42 per component. a. What is the break-even volume? Round up to the next whole number b. What is the break-even revenue? Round to the nearest cent c. What is break-even as a percent of capacity per annum? % Round to two decimal places if necessary d. If she produced and sold 23,600 components in a year, what was the profit made or loss incurred? Express the answer as a positive number for profit and negative number for loss, rounded to the nearest cent e. What is the maximum profit per year that she can expect from her company?arrow_forward
- As an example of a company that did not ignore its cost of capital, consider Coca-Cola in the 1980’s. It had very little debt because it preferred to raise equity capital from its stockholders. It also had a diversified product line, including products like aquaculture and wine. But none of these activities earned as much as its soft drink division. The opportunity cost of investing in these unrelated businesses was the forgone opportunity to expand the soft drink division, which at the time was earning a 16 percent return on capital. Although, these other businesses were earning a positive 10 percent rate of return on capital, the opportunity cost of that capital was 16 percent. CEO Robert Goizueta correctly decided to sell off these under-performing divisions and invest the capital in its soft drink division. By making decisions whose benefits were greater than their costs, the topic of this chapter, Coca-Cola increased its profitability.arrow_forwardPlease help?arrow_forward\table[[Number of Factories,Q=100,Q=200,Q=300,Q=400,Q=500,Q=600arrow_forward
- 10arrow_forwardA delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $300 per day. Assume that the additional vehicle would be capable of delivering 1,750 packages per day and that each package that is delivered brings in $0.30 in revenue. Also assume that adding the delivery vehicle would not affect any other costs. Instructions: Enter your answers rounded to 2 decimal places. a. What is the MRP? What is the MRC? MRP = $ MRC = $ %3D Should the firm add this delivery vehicle: Yes b. Now suppose that the cost of renting a vehicle doubles to $600 per day. What are the MRP and MRC? MRP = $ MRC = Should the firm add a delivery vehicle under these circumstances: No c. Next suppose that the cost of renting a vehicle falls back down to $300 per day but, due to extremely congested freeways, an additional vehicle would only be able to deliver 750 packages per day. What are the MRP and MRC in this situation? MRP = $ MRC = $arrow_forwardWhat must an entrepreneur do to earn a profit? How do theactions of firms earning profits influence the value of resources?What happens to the value of resources when losses are present?If a firm making losses goes out of business, is this bad?Why or why not?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Microeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506893Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningMacroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningEconomics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage Learning
- Managerial Economics: Applications, Strategies an...EconomicsISBN:9781305506381Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. HarrisPublisher:Cengage Learning
Microeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Macroeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Managerial Economics: Applications, Strategies an...
Economics
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:Cengage Learning