Explain the three categories of rreturns to scale relating to the long-run average cost curve

Q: Suppose you are a producer of motor vehicles, explain with the use of examples the difference…

A: Economies of scale exist when since a long time ago run normal total expense diminishes as yield…

Q: B. Refer to the figure below. LRAC a. In the short run, capital is a fixed cost. Draw for a few…

A: Short Run Average Cost (SRAC) is equal to average fixed cost and average variable cost. It is…

Q: What is the variable cost of production ( per month)

A: Variable Cost = Labour Cost+Ingredients+electricity Variable Cost =4.00+2.00+0.20 Variable Cost…

Q: A bottling company uses two inputs to produce bottles of the soft drink Sludge: bottling machines…

A: Given  wage for labor w =$200 rent of machine r =$1000 At current level of production, the Marginal…

Q: Cost schedule Labor Output (units per day) Total variable costs Total costs (workers) (dollars)…

A: Given:  Cost schedule is given, where labor, output, total variable cost and total costs are…

Q: With reference to returns to scale: a) Explain what is meant by returns to scale. b) Use an isoquant…

A: a) Returns to scale refers to how the output changes as the input changes. There are three types of…

Q: Why do Economies of Scale Occur? A. Large firms cover their fixed costs by producing lots of units…

A: Fixed cost is constant and remains same at all levels of output. Average cost refers to total cost…

Q: If Boeing produces 9 jets per month, its long-run total cost is $9.0 million per month. If it…

A: Economics of scale: It refers to the situation when increasing production leads to falling per unit…

Q: Explain and identify the relationship between total cost, average cost and marginal cost using…

A: Total cost is defined as the total expenses that a company or firm has to incur in order to produce…

Q: Explain the difference between fixed and variable costs, and giveexamples of each.

A: Fixed and variable costs are the types of production cost that a producer incurs while producing a…

Q: Note: Plot your points in the order in which you would like them connected. Line segments will…

A: Suppose Ike's Bikes is currently producing 100 bikes per month in its only factory. Its short run…

Q: Refer to Figure 1. Which of the short-run average cost curves correctly depict economies to scale?…

A: Long-run average cost The long-run average cost is tangent to the falling portion of the short-run…

Q: A firm's short-run cost function is C(a) = 240q – 69° + 0.6q° + 600. Determine fixed cost, F;…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: Quantity of cars Oa Ob Oc Od 1-8 6-8 1 2 46 3 4 5 6 7 8 LRATC of car $30,000 20,000 The wagon is a…

A: A firm which is long-run average total cost (LRATC) shows the average cost per unit of output over a…

Q: Construct Len’s total variable cost and total cost schedules. What does the difference between total…

A: ANS Len’s body board factory pays $60 a day for equipment this is the fixed cost and it pays $200 a…

Q: Use the concepts of economies and diseconomies of scale to explain the shape of a firm’s long-run…

A: Economies of scale refer to the cost advantages that are derived from the expansion of the scale of…

Q: Define and explain the difference between short run and long run and identify the relationship…

A: Short-run average cost curves: In the short run, the shape of the average cost curve is 'U' shaped.…

Q: Assume that Peter's short run Total Cost Curve is TC = 20,000q- 200q² +q*. Calculate his (short run)…

A: Average total cost is total cost divided by quantity.  ATC = TC / q => ATC = (20,000q - 200q2 +…

Q: Long-run average c Number of units produced Figure 8.9 Which segment in the diagram represents the…

A:

Q: What is the typical shape of the average fixed cost curve, Why is it shaped this way. Graphically…

A: Average Fixed Cost (AFC) is the cost that must be incurred in fixed quantity regardless of the level…

Q: Consider the following table of long-run average total costs for a firm. Does the firm experiences…

A: please find below  the answer.

Q: Q50 The point of tangency between the short-run average total cost (SRATC) curve and the long-run…

A: Answer: The long-run average total cost curve is tangent to the minimum points of the short-run…

Q: onsider a short run production function q = cL+K where the value for c =: sing L units of labour and…

A: Returns to scale measures the proportionate change in output if all inputs are changed by the same…

Q: a= min[x,y]^(1/2) a)Draw isoquants for a = 1, a = 4 and a = 9. b)What kind of returns to scale does…

A: Production refers to the process of using inputs to make useful output. The functional relationship…

Q: to Scale and Economies of Scale uahon in whien output doubles when all inputs ae lovlored. > Can a…

A: Return to scale show the long-run production function where it can be increasing, decreasing, and…

Q: 1. Economies of scale Vision Source is a cable television provider. In the long run, Vision Source…

A: Average total cost (ATC) = Total cost (TC) / Output (Q) When Q = 20,000, ATC = 700,000 / 20,000 = 35…

Q: briefly explain returns to scale.  Explain the variable costs in the cost function

A: returns to scale allude to the rate by which result/output changes on the off chance that all…

Q: What is the impact of a fall in productivity on costs. Explain further.

A: The primary aim of the business is to maximize the profit and reduce the cost. The efficiency of the…

Q: Consider the following information on long run total costs: Output 1 2 3 4 5 6. 7 Total Costs 50 90…

A: Output Total Cost Marginal Cost ATC 0 0 0 0 1 50 50 50 2 90 40 45 3 123 33 41 4 160 37 40…

Q: What is the total variable cost of 2 oil changes?

A: Total cost is the sum of fixed cost and variable cost.

Q: 23. The following table represents the short-run total cost schedule of an energy drink…

A: 23. The Average Variable Cost to the firm when 30 bottles of mineral water produced is:  c. R23.33…

Q: Using the table below indicate which firm has (i) diseconomies of scale and (ii) constant returns…

A: Diseconomies of scale occurs when a firm's Average cost increases with increase in the output.…

Q: AVERAGE TOTAL COST (Dollars per bike) 640 560 480 400 320 240 160 80 0 0 100 200 300 400 QUANTITY…

A: Short-run is such a period in which at least one of the factors of production is fixed whereas the…

Q: What are some reasons we might see increasing returns to scale?

A: When the output grows by a higher percentage than the growth in inputs during the manufacturing…

Q: Define fixed and variable costs and give examples of each in manufacturing. What is total cost,and…

A: Cost is something that, depending on its type, can be categorized in many ways. Classification…

Q: Šuppose that a producer is faced with input combinations that yield 500 units. Assume that capital…

A: Optimal input combination is where Isocost line is tangent to Isoquant curve.

Q: 4. Based on the above table, what is the value of Average Total Costs (AC) at 5 units?

A: The above table can be filled in as follows:  Quantity  FC VC TC MC 0 10 0 10 - 1 10 5 15 5…

Q: A firm experiemces A) diseconomies of scale, average total cost curve slopes downward B) economies…

A: C)diminishing marginal Returns; average total cost curve shift upward

Q: onsider a short run production function q = cL+K where the value for c=3, sing L units of labour and…

A: Marginal productivity of labor depicts how there is change in output due to additional unit of…

Q: A firm hires two workers and rents 15 acres of land for a season.It produces 150000 bushels of…

A: Here, it is given that, Initial production: 150000 bushels of crop Final production after doubling…

Q: (a). If the firm is currently producing 90 units of output at input mix X, which of the following…

A: The isoquant graph shows that the different combinations of inputs yield the same output level to…

Q: Average Total Cost ($ per tablet) Q=400 Number of Factories Q=100 Q=200 Q=300 Q=500 Q=600 1 400 300…

A: As we know in the long run firm cost function are U shaped but minimum of cost goes long period of…

Q: The "Sad Student" Company finds that it costs a total of C(q) = 9720 +500q – 1.5q² +0.005q Dollars…

A: The total cost function is the minimum total cost borne by a firm for any given level of output (q)…

Q: what is the Explicit and Implicit cost? find the accounting profit and the economic profit Suppose…

A: Explicit cost are those cost which is hired by producer from outside' Implicit cost also known as…