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Q: how do firms choose how much output to produce.
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Discuss how firms choose how much output to produce.
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- How will you explain production as a source of economic well-being?The optimal level of production is the level that either maximizes profits or minimizes losses. How does one determine the optimal level of production for any business? Explain.What mix of inputs should be used to produce a given level of output?
- Why does more inputs not necessarily translate into more output?The optimal level of production for any company is the level of production that either maximizes profits or minimizes losses. How does one determine the optimal level of production for any business? Explain.what is the importance of long run and short run production in production theory?
- Discuss the various production costs that firms face.The oversupply of bananas in Mexico, which is recorded in the months of September and October, causes prices to farmers to be reduced by up to 50 percent below the cost of production, said Adrián Prats, president of the banana product system at the national. "It is a critical situation, we are selling the fruit below the cost of production, which is when it really impacts the producer, since he has to continue maintaining his plantations healthy and vigorous and that costs. We have to invest in it, even though the price is not giving to pay, even, the costs", explained Prats. The above causes: a. By decreasing the price of bananas, marginal income decreases and therefore, production must be increased (T/F) _________ b. By lowering the price, the company will have to take care of its costs. To avoid leaving the market, the producer must ensure that, at least, the average variable costs (T/F) _______ are covered c. It is recommended that a banana producer who invests in keeping his…The optimal level of production for any company is the level of production that either maximizes profits or minimizes losses. How does one determine the optimal level of production for any business?