It costs a firm C(q) to produce q units of output. If C(q) = q° – q² what kind of returns to scale does this technology exhibit for q > 1/3? Decreasing returns to scale Increasing returns to scale Constant returns to scale

Q: For the cost function C(Q) = 200+3Q2+4Q3, what is the average fixed cost of producing 10 units of…

A: We have total cost function: C(Q)=200+3Q2+4Q3          ... (1) We have to calculate average fixed…

Q: Suppose the cost function is C(Q) = 50 + Q − 10Q2 + 2Q3. At 10 units of output, the average cost…

A: In economics, the cost curve is a graph of production costs as a function of the total value…

Q: To maximise profits, a competitive firm has a cost function, C(q) = 4q2 + 95 and produces 33 units…

A: The profit is maximized where the P=MC.

Q: Suppose a firm has chosen its quantity so that its marginal cost isequal to the market price, and is…

A: Known fact:Economies of scale: The economies of scale is a situation in which output can be doubled…

Q: A firm is producing 20 units with an average total cost of $25 and a marginal cost of $15. If it…

A: Average total cost is total cost divided by total output produced,  ATC = TC / Q Marginal cost is…

Q: Costs which increase with an increase in output are called________________ Costs which do not…

A: There are two main components of the total cost(TC) that a firm incurs. One is the variable cost(VC)…

Q: Fixed costs differ from sunk costs in that a firm can avoid fixed costs by not producing anything

A: Avoidable costs are costs that do not occur if the activity is not performed. For example, supply…

Q: In the previous Problem Set question, we started looking at the cost function C (x), the cost of a…

A: Cost function is given by C(x) = 0.04x3-20x+350

Q: If a firm is experiencing economies of scale, doubling inputs will: double output. more than double…

A: Economies of Scale: The economies of the scale refer to the gain that arises due to the increase in…

Q: A manufacturer believes the function C(x) = 0.25x² 20x + 950 - where 0≤x≤ 100 approximates the…

A: Marginal cost refers to additional cost that is incurred from producing one more unit of output. It…

Q: Diseconomies of scale occur when:A) average total cost increases as output increases.B) average…

A: The process of production is the combining of the raw materials and the skills and knowledge of the…

Q: A firm with decreasing returns to scale can expect to produce       [a. more than, b. less than,…

A: Returns to scale Returns to scale is a metric for determining how efficient a production function is…

Q: A firm trebles its inputs and discovers that its output rises by a factor of four. This is an…

A: Note:  We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: Suppose each firm of the industry has a short-run total cost curve of TC = 5+4q+q², where q is…

A: Total cost of production refers to the total monetary value incurred on fixed as well as variable…

Q: Exercises 47-50 describe a number of business ventures. For each exercise, a. Write the cost…

A: Since you have posted a question with multiple sub-parts, we will solve first three subparts for…

Q: The long run is a period of time, or a time frame, in which        all resources are fixed.…

A: A long run in the economics is the time when the manufacturers and producers have the flexibility of…

Q: Melvin manufactures a single product. Total cost per unit is $70 when production is 100 units per…

A: Total cost per unit if production is 100 units per week = $70 Total cost of 100 units per week =…

Q: The marginal cost function of a company is given by MC 5+x, and the cost of producing 2 umits is 712…

A: Fixed costs are costs that do not change when sales or production volumes increase or decrease.Fixed…

Q: Fixed costs are best defined as costs that do not vary with output. the amount that one more unit of…

A: Fixed Cost: It is the cost that is incurred for purchasing fixed factors of production. It is…

Q: A competitive firm has a technology function defined as Q = f(K,L) = K^2+ KL. Here, Q is the weekly…

A: Production function : Q = K2 + KL  Price of output = 6  Wage rate (w)= 54  Capital Cost(r) = 25…

Q: A firm is producing 20 units with an average total cost of $25 and marginal cost of $15. If it were…

A: Costs are the expenses that firms have to incur in all of their production activities.

Q: When a firm doubles its inputs and finds that its output has more than doubled, this is known as а.…

A: Inputs and output are important for business. Inputs are raw materials, equipment, and machinery…

Q: How does learning by doing affect average total costs? Short-run average total costs will remain…

A: Learning by doing is a process of achieving productivity through practice, innovations, and…

Q: If an increase in output size results in reductions in average costs, this is known as:…

A: An increase in the level of production increases the size of the output. This leads to a fall in the…

Q: Which of the following results from bureaucratic red tape, breakdown of top-to-bottom communication,…

A: The Diseconomies of scale are the consequence that occurs because of bureaucratic red tape,…

Q: This are the additional costs that result from increasing the output level by one or more units.

A: GIVEN   This are the additional costs that result from increasing the output level by one or more…

Q: When output increases from 20 to 30 units the total cost increases from $500 to $600. Assuming the…

A: Average Total Cost (AC): - it is the average value of total cost by producing a specific unites of…

Q: A company discovers that their total cost is $1700 at an output level of 9 units and $2000 at an…

A: Given: The total cost for a company at output level of 9 units is = $1,700 The total cost for a…

Q: You are the owner of a small company that makes laptops at the price of $550. Your variable cost of…

A: The number of laptops can be found by equating price and the cost of producing laptops. We will find…

Q: . If a firm has economies of scale, it must have increasing returns to scale. True or false? EXPLAIN…

A: Economies of scale provides cost advantage to the firm.Firm is able to lower average cost through…

Q: Consider a simple three-step manufacturing process as illustrated in the figure given. Assuming the…

A: Demand is a monetary guideline alluding to a purchaser's craving to buy labor and products and…

Q: A factory that you are managing has an hourly production process that can be represented by the…

A:

Q: follouring production functions exhibits increasing returns to scale in

A: When increase in inputs lead to increase in the output by more amount, then we have increasing…

Q: Suppose a firm's long-run average cost is increasing as the firm produces more output. Then the firm…

A: Long-run average total cost is a business metric that represents the average cost per unit of output…

Q: The feature that distinguishes short-run from the long-run is the*

A:

Q: Distinguish between short-run and long-run production decisions and illustrate their impact on costs…

A: Average cost is total cost divided by total production while marginal cost is the change in total…

Q: At zero level of production, _______ cost is always zero

A: Whenever production starts, the firm has to incur costs such as rent of the property such as…

Q: Which of the following would shift a firm's short-run cost curves downward? a.an increase in excise…

A: The minimum cost impact of output changes for a specific plant size is referred to as a short-run…

Q: accountant for a car rental company was recently asked to report the firm's costs of producing…

A: A company's complete expense is the amount of the expenses of the multitude of information sources…

Q: Given a cost function C(x), which returns the total cost of producing x products, the average cost…

A: Total cost function  C(x) = 80x+150

Q: When a firm triples its inputs and finds that its output has less than tripled this is known as:…

A: Production function is a definite mathematical relation between factor inputs and output generated,…

Q: Consider a firm that suffers diseconomies of scale. If this firm wants to produce half as…

A: "Diseconomies of scale occurs when each item produced cost more and more as a firm continue to grow…

Q: If a business has a long-run cost (TC) function given by TC = aq' – bq² + cq where q = the rate of…

A: Given  Total cost function TC=aq3-bq2+cq              ... (1) q= rate of output  a, b and c are…

Q: A firm’s production function is - y = f(X1, X2)= X11/2 + X1X2 , Where X1≥0, X2≥0 1. Find its…

A: The returns of scale are of three types 1. Increasing returns of scale 2. Constant returns of scale…

Q: manufacturer!s total cost is C(x) = 0.1x3 - 0.25x2 + 300x + 100 dollars, where x is the level of…

A: We calculate the total cost with x=6 and x=6.1 and then see the difference. TC(6) = 0.1(6)3 -…

Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.