If a short-run iso-profit line is defined as y=w1px1+∏+w2x′2py=w1px1+∏+w2x2′p then, an increase in w1w1 causes an increase in the slope and no change to the vertical intercept. Select one: True False
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If a short-run iso-profit line is defined as y=w1px1+∏+w2x′2py=w1px1+∏+w2x2′p then, an increase in w1w1 causes an increase in the slope and no change to the vertical intercept.
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- Suppose the short-run production function is q = 11L². Suppose that the wage rate is $112 per unit of labor. What is the marginal cost at q = 255?The following is cost information for the Creamy Crisp Donut Company. Entrepreneur's potential earnings as a salaried worker = $50,000 Annual lease on building = $22,000 Annual revenue from operations = $380,000 Payments to workers = $120,000 Utilities (electricity, water, disposal) costs = $8,000 Value of entrepreneur's talent in the next best entrepreneurial activity = $80,000 Entrepreneur's forgone interest on personal funds used to finance the business = $6,000 Creamy Crisp's implicit costs, including a normal profit, areABC Company Limited is a new business established to produce tables (in units). The demand function for tables is given as 4? = 35 − 0.5?. It has been estimated that the total fixed cost is GH¢80 and average variable cost function is 3? − 51 + 320, where Q is number of tables produced ? and P is the price per table (in GH¢). Given this information, what is the total profit at the profit maximizing level of output, and what is the best pricing policy option?
- The frictional theory of profits holds that firms in a competitive industry can have economic profits that differ from zero for long periods of time. a. True b. FalseA firm faces the following average revenue (demand) curve: P = 100 - 0.01Q. where Q is weekly production and P is price, measured in cents per unit. The firm’s cost function is given by C = 5Q +2000. Assuming the firm maximizes profits production, determine the price and total profitper week.In a highly competitive market, we generally find very low Lerner Index values. Those market are also likely to have: Group of answer choices very low capital to labor ratios. very high entry barriers. very high capital to labor ratios. flat learning curves.
- an American multinational that sells consumer electronic products, has manufacturing facilities in three countries: Brazil, Thailand, and Canada. The average hourly wage rate, output per worker, and annual overhead cost for each location are as follows: Given the above figures, is Storm currently allocating its production resources optimally? If not, what should it do? Justify your answer. Now, suppose that Storm is planning to consolidate all its manufacturing into one facility. Where should it locate? Justify your answer.An employer faces two types of employees. Regular workers at 90% of the population and generate $75,000 in productivity. Exceptional workers are 10% of the population and generate $100,000 in productivity. Employees know their types and reject salaries below their productivity. If employer offers a salary equal to the average productivity in the population, what will be the employer’s per-employee profit? How can this be fixed?. An electricity producer has a constant marginal cost of production equal to $40 per megawatt. The residual demand for its electricity is given by P (q) = a−bq, where P is the price and q is the quantity of power generated by this producer. The producer knows the slope, b, but he vertical intercept of the residual demand curve, a is unknown. Assume A and B are greater than zero. If you get stuck, you may answer any of the following questions for special case where a = 80 And b = 0.5 for partial credit. (a) What is the marginal revenue, M R(q), for this producer? b) What is the optimal q for this producer? (c) What is the electricity producer’s optimal price? (d) What is the electricity producer’s optimal bid in a uniform price Auction? e) Suppose b is equal to zero. Would the producer have an incentive to submit a bid above its marginal cost? Explain.
- “Short-Run Production Theory is the mirror opposite of Short-Run Cost Theory,” Is thisstatement true or false? Take a position and support it using appropriate graphs and outside sources. Please remember to cite sources. Note: Your graphsshould be neatly sketched by hand, scanned, and uploaded with your typed response in Canvas. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Q1: Normal profit is a term for explicit profit the competitive rate of return the accounting profit forgone pure economic profit Q2: Which of the following items is most likely to be an implicit cost of production? the "competitive rate" salary the owner of the business pays herself for services provided property taxes on a building owned by the firm rental payments for a building utilized by the company and rented from another party the interest income foregone on the equity capital invested by ownersThe marginal profit function of a firm (profit (Π), point (Q) rate change depending on quantity) is MΠ = Π ^ '= dΠ / dQ = -2Q + 120. The fixed costs of the firm produced by the company are 1000 TL. In addition, the company is known to sell the goods it produces for 200 TL. Accordingly, answer the following questions.a) Find the firm's profit function.b) Find the cost function of the firm.