1. Micky's auto mechanic shop has a daily total cost represented by: C = 98 + 2q + 2q². Shop's marginal cost is given by: MC = 2 + 4q, where q is the number of repaired cars. a. Derive an expression for average cost. Find the quantity range where the shop experiences the economies scale (Hint: scale economy index is given by: S = AC). c. At what production level are scale economies exhausted²? b.
Q: 2 COLD BREW VS. ICED COFFEE Lauren's preferences over cold brew, C, and iced coffee, I, are given by…
A:
Q: 8.16 The fixed and variable costs for three potential manu- facturing plant sites for a rattan chair…
A: A company's profits are determined by subtracting its costs from its revenues. The company's main…
Q: You are considering investing $2,500 at an interest rate of 7.7% compounded annually for seven years…
A: Introduction Borrowers must pay lenders simple interest as a fee for a loan. Compound interest is…
Q: Using the following table, for each price level, calculate the optimal quantity of units for the…
A: Types of costs: A firm's total cost can be divided into two main categories- Fixed cost: The cost…
Q: . (Mankiw modified) illustrate how each of the following events affect price and quantity in the…
A: Disclaimer: - Since you asked multipart question, we are solving only first 3 subparts as per…
Q: Referring to this table, calculate the marginal propensity to consume. Output Consumption Investment…
A: In economics, the MPC is a metric that quantifies induced consumption, the concept that the rise in…
Q: *) Construct a time series line graph of the stock prices for each of the following companies,…
A:
Q: Q1) Given the following economic identities: GDP = C+I+(X-M)……………………………...…………………………………………….…
A: a) Macroeconomic policy is defined as a set of federal government rules and guidelines adopted to…
Q: A consumer consumes two goods: wraps and tea, with respective quantities x1 and x2. Suppose the…
A: Indifference curve is the curve in which satisfaction of consumer on different combination is…
Q: In Zimbabwe the rate of inflation hit 90 sextillion percent in 2009, with prices increasing tenfold…
A: Hyperinflation refers to a scenario in which inflation is extremely higher and acceleration. In such…
Q: In the previous problem, do we have a trade surplus or trade deficit?
A: Gross domestic product (GDP) is the standard computation of the value added created through the…
Q: What is the price elasticity of demand for subway rides?
A: The price elasticity measures the responsiveness of the change in the quantity demanded due to the…
Q: A bottle company ALPHA, is considering creating a new bottle of 0.25 lt. To decide whether to invest…
A: Net cash flow is a profitability indicator that shows how much money a company made or lost during a…
Q: A consumer has utility function u(x1, x2) = ln(x1) + 2 In(x2) and income m. a) Find the Marshallian…
A: Marshallian demand refers to the concept of consumer demand as described by economist Alfred…
Q: Are you concerned about the inflation come back due to such easy monetary policy with zero interest…
A: Inflation is the increase in an economy's average level of prices for goods and services. Each unit…
Q: 1. Consider a perfectly competitive market with a price of $12, where each firm has a cost function…
A: In microeconomics, long run equilibrium in perfect competition refers to a state where all firms in…
Q: Calculate total labor force growth rate in 2022 compared to 2021?
A: Labor force = Employed + Unemployed Labor force in 2021 = 11,484,656 + 680,176 = 12,164,832 Labor…
Q: There are two countries Home and Foreign. Home has 1,200 units of labor available. It can produce…
A: Relative demand and supply: Relative demand and supply are two very important concepts for…
Q: What is the equal payment series for 12 years that is equivalent to a payment series of $15,000 at…
A: Introduction Calculations of NPV can always be used to create a fixed payment stream that is equal…
Q: ind the equilibrium price ratio and calculate the consumers’ demand for each of the two goods…
A: Both utility functions are perfect substitutes. Hence, consumer is willing to spend all her income…
Q: Calculate GDP given the following table. (Do not include a dollar sign with your answer.) Item…
A: GDP is an important measure of economic activity that represents the market value of the total…
Q: Select one: O MRt Interest rate (r) % MRW O MRX MRy O MRZ 14 12 10 Inflation % 8 6 4 2 14 12 10 8 6…
A: IS curve: IS curve shows different combinations of interest rate and the income. Such that for each…
Q: analyse effect from of the demographic changes on the competitiveness of countries engaged in…
A: What is a demographic change? The changes in the total population or the pattern of the population…
Q: Hyperion Enterprises had their bank wire money to their partner in an international joint venture.…
A: Introduction Sending money electronically between accounts is simple and secure with a wire…
Q: (a) Solve the firm's maximization problem and derive the labour demand curve. (b) Graph the labour…
A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…
Q: Consider the production function Y=K1/2 N1/2 a. Compute output when K=37 and N=80 b. If both capital…
A: Production function: The production function yields the output levels for which the input levels are…
Q: Using the one-period closed economy model, show graphically the effects of a decrease in government…
A: Government spending (GS) is one of the most important components of the aggregate demand function.…
Q: There are two consumers, Cindy and Shelly. Cindy’s marginal rate of substitution equals C/L.…
A: Consumption-leisure choice model: Individuals need to trade-off between how many hours to work and…
Q: The marginal social cost is equal to marginal private cost + demand marginal external cost +…
A: Externality is an economic term that is used to indicate the expenditure related or benefits…
Q: The bank wants to receive a fair value in t=0 of 100,--EUR for her risky bond. 1. Please briefly…
A: A bond is a debt security that represents a loan made by an investor to a borrower, typically a…
Q: Please explain how to graph this. From the curve of the demand and supply and the factors that…
A: The tariff on imported raw sugar and the advertising campaign by Coke and Pepsi will likely cause…
Q: Which was not one of the reasons of adopting nationalism for Mercantilist? Select one: a. To…
A: Mercantilist refers to the group of the individuals who believed that the economic growth can be…
Q: The marginal profit for a certain company is MP₁(x)= x² + 18x-45. The company expects the daily…
A: Marginal profit is the additional profit that is received by the trader by an additional unit of…
Q: 4.8 Two of the simplest utility functions are: 1. Fixed proportions: U(x, y) = min[x, y]. 2. Perfect…
A: Utility functions provide the level of utility that is attained by the consumer for the given…
Q: 3.17. Consider the social choice function that selects as a winner the candidate (or candidates)…
A: In economics, voting refers to a decision-making process used in democratic societies to reach a…
Q: The figure to the right illustrates the demand for taxi rides in a large city. Suppose the price per…
A: Price elasticity of demand measures the responsiveness of change in quantity demanded to change in…
Q: A 95% confidence interval for the slope of a simple linear regression model is found to be (0.0046,…
A: Regression equation states the relationship between the dependent variable and one or more…
Q: Consider the following empirical research question: "To what extent does the per capita consumption…
A: Empirical research is a type of research that relies on direct or indirect observation and…
Q: Every month, Sam spends 0.2 of his income on gasoline, no matter what the price is. The price of…
A: According to inverse demand curve, the price will be the function of quantity demanded.
Q: Millennium Freight is evaluating the possibility of adding a new shipping route, which would require…
A: The present worth of a project or an investment refers to the present value of the benefits or costs…
Q: 3. Rudy Chappa owns an internet running goods website. He sells a single type of shoe: ‘Nike elite'…
A: Profit maximization level of output is the optimum output produced at the point where marginal…
Q: ng graph, plot the demand for laundry detergent using the blue point (circle symbol). Next, plot the…
A: The demand curve depicts the inverse relationship between price and quantity demanded, keeping other…
Q: Suppose the fictional country of Everglades produces only two goods: sorghum and telephoto lenses.…
A: PPF is the production possibility frontier. PPF is defined as the production possibility of two…
Q: Use the information in the following table on labor productivities in Spain and Italy to answer…
A: Comparative Advantage is an economy's ability to produce a particular good or service at a lower…
Q: A new accountant works on the Balance of Payments of a country and records the following into the…
A: In the balance of payment account, financial account is the one in which all the international…
Q: If the demand for a good is Q = 1,400 - 100p, then marginal revenue function is given by 14-Q/50…
A: A monopsonist is the sole employer in the market. Labor is demanded by the single firm.
Q: Compute 2 measures for inflation rate (%) from 2013 to 2021 (over 8 years, not annual rate): one…
A: CPI = cost of market basket in current periodcost of market basket in base period×100 GDP Deflator =…
Q: If there is a conflict between the Generally Accepted Accounting Principles (GAAP) vs. Tax Laws,…
A: Taxation basically refers to the process by which a government raises revenue from its citizens and…
Q: 7. If a firm practices first-degree price discrimination, the firm must: (a) have customers with…
A: Price discrimination is a pricing strategy where a firm charges different prices for the same…
Q: 2. Consider a pharmaceutical company considering research and development of a new drug. They…
A: Since you have asked a question with multiple sub-parts, we will solve the first three sub-parts for…
The AC is the average price of goods and services. At the point when we have numerous items to sell or purchase at practically similar worth, the average of these values will give the average cost price. It helps shopkeepers in the buying and selling process.
Step by step
Solved in 2 steps
- The accompanying table shows a car manufacturer’s total cost of producing cars.a) What is thismanufacturer’s fixed cost?b) For each level of output, calculate the variable cost (VC). For each level of outputexcept zero output, calculate the average variable cost (AVC), average total cost(ATC), and average fixed cost (AFC). What is the minimum-cost output?c) For each level of output, calculate this manufacturer’s marginal cost (MC).d) On one diagram, draw the manufacturer’s AVC, ATC, and MC curves.2. Labor costs represent a large percentage of total costs for many firms. According to data fromthe Bureau of Labor Statistics, U.S. labor costs were up 2.0% in 2019, compared to 2018.a) When labor costs increase, what happens to average total cost and marginal cost?Consider a case in which labor costs are only variable costs and a case in which theyare both variable and fixed costs.An increase in labor productivity means each worker can produce more output. Recent data onproductivity show…Given the quantity produced (Q), Total fixed cost (TFC) and Total Cost (TC), (1) calculate Total Variable cost (TVC) and (2) Draw Total cost (TC) curve.Complete the Daily Production Cost Schedule table below. Quantity MR = Price per Unit TFC TVC AFC AVC TC ATC MC 0 $ 325.00 $ 100.00 1 $ 325.00 $ 100.00 $ 400.00 2 $ 325.00 $ 100.00 $ 600.00 3 $ 325.00 $ 100.00 $ 750.00 4 $ 325.00 $ 100.00 $ 950.00 5 $ 325.00 $ 100.00 $ 1,200.00 6 $ 325.00 $ 100.00 $ 1,525.00 7 $ 325.00 $ 100.00 $ 1,950.00 Abbreviations: MR: Marginal revenue TFC: Total fixed cost TVC: Total variable cost AFC: Average fixed cost AVC: Average variable cost TC: Total cost ATC: Average total cost MC: Marginal cost
- What is the Marginal Cost if TC =10+5q What is the marginal cost if TC= 100+5q ExplainThe graph below represents sales per week of ABC Inc. Ltd, a monopoly multinational enterprise that supplies Hi-tech components. Use the graph to answer the questions that follow. i. Suppose the demand and cost curves result in ABC Inc. Ltd earning aneconomic profit. Do you think ABC Inc. Ltd firm will earn profit in the longrun? Explain your answer. Assume all factors constant.Draw an example of the Total Fixed Cost, Total Variable Cost, and Total Cost of acompany whose marginal cost is constant for all Q>0. (Please have the quantity (Q) on thehorizontal axis and money on the vertical axis. You do not need to provide thefunctional form or numbers, just the graphs with the appropriate shape)
- The table below shows Crystal's total cost of producing different quantities of tie-dyed t-shirts for a local festival. Instructions: Enter your answers as a whole number. a. Complete the marginal cost column in the table. Tie-Dyed T-Shirt Production Costs Output Total Cost (dollars) Marginal Cost (dollars) 0 $15 - 1 18 $ ________ 2 20 _________ 3 21 _________ 4 24 _________ 5 29 _________ 6 36 __________ b. Graph the marginal cost curve for producing tie-dyed t-shirts. Instructions: Use the tool provided "Marginal Cost" to plot the line point by point (6 points total). Plot from 1 to 6 units of…Pat's Pizza Kitchen has the following total cost schedule. Output (pizzas per hour) Total cost (dollars per hour) 0 10 1 21 2 30 3 41 4 54 5 69 Use the data to draw Pat's supply curve. Pat's is a price taker. Draw a point to show the quantity of pizza supplied when the market price equals minimum average variable cost and Pat's continues to produce pizza. Draw a point to show the quantity of pizza supplied when the market price is $14 a pizza. Draw Pat's supply curve: Label the part at which Pat supplies zero pizza S0 and label the part at which Pat's supplies some pizza S1.Pat's Pizza Kitchen has the following total cost schedule. Output (pizzas per hour) Total cost (dollars per hour) 0 10 1 21 2 30 3 41 4 54 5 69 Use the data to draw Pat's supply curve. Pat's is a price taker. Draw a point to show the quantity of pizza supplied when the market price equals minimum average variable cost and Pat's continues to produce pizza. Draw a point to show the quantity of pizza supplied when the market price is $14 a pizza. Draw Pat's supply curve: Label the part at which Pat supplies zero pizza S Subscript 0 and label the part at which Pat's supplies some pizza S Subscript 1.
- Suppose that each firm in a competitive pizza market has the following identical cost: Total cost: TC=25+1.5Q2i. Formulate the equation or level of fixed cost, variable cost, marginal cost, average variable cost (AVC) and average total cost (ATC) for each firm.ii. Sketch a diagram to illustrate average total cost (ATC) and marginal cost (MC) for Q from 1 to 20. Identify the quantity at which the average total cost (ATC) reaches its minimum and interpret its economic or business implication.iii. An innovation was diffused widely among all firms in the market. Adoption of this innovation will help to reduce 20% of the variable cost for any given level of production while all other factors remain the same. A firm needs to pay a fee of $5 to adopt the innovation. Formulate the new production cost functions (TC, TFC, TVC, ATC and MC) for each firm.(Suggested word count: 300-350 words)Define the term "sunk costs" and illustrate with an example. View keyboard shortcutsFor a firm with a Total Cost function TC C(Q), recall that the definitions of Marginal Cost (MC) and AverageTotal Cost (ATC) are given as follows:Marginal Cost (MC) = C'(0)Average Total Cost (ATC) = C(Q)/QProve that the marginal cost is equal to the average total cost (MC = ATC) when the average total cost is at itsminimum value.(Hint: By using the definition of average cost function, find the quantity that minimizes it by applying unconstraint optimization.Show that the FOC of the minimization problem implies that MC=ATC has to be satisfied at the minimum level of average cost.)