Price (S) 500 300 MC ATC 100 200 400 Quantity/Month 1. This question is based on the figure above, which describes cost and demand conditions in the widget industry. Assume that costs functions to not vary according to market structure (competition vs. monopoly, for example). Complete the following table. All variables should be expressed in dollars. (Hint: use the Cowling and Mueller method for measuring consumer surplus and deadweight) OFocus

Price (S) 500 300 MC ATC 100 200 400 Quantity/Month 1. This question is based on the figure above, which describes cost and demand conditions in the widget industry. Assume that costs functions to not vary according to market structure (competition vs. monopoly, for example). Complete the following table. All variables should be expressed in dollars. (Hint: use the Cowling and Mueller method for measuring consumer surplus and deadweight) OFocus

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Proudction Costs

Section: Chapter Questions

Problem 8SQP

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The costs of producing a commodity consist of ₱102.00 per unit for labor and material cost and ₱54.00 per unit for other variable cost. The fixed cost per month amounts to ₱850,000. The commodity is sold at ₱740.00 each, what is the break-even quality per month? (Hint: for Break-even quality, COST = REVENUE)
based on the information in the table what is marla's profit margin? total revenue-$1,400total cost- $900average cost- $7fixed cost-$700quantity-200
Ella Ltd recently started to manufacture and sell productDG. The variable cost of product DG is £4 per unit and the totalweekly fixed costs are £18 000.The company has set the initial selling price of product DG byadding a mark up of 40 per cent to its total unit cost. It has assumedthat production and sales will be 3000 units per week.The company holds no stocks of product DG.Required:(a) Calculate for product DG:(i) the initial selling price per unit; and(ii) the resultant weekly profit. The management accountant has established that alinear relationship between the unit selling price (P in £)and the weekly demand (Q in units) for product DG isgiven by:P = 20 - 0:002QThe marginal revenue (MR in £ per unit) is related to weeklydemand (Q in units) by the equation:MR = 20 - 0:004Q(b) Calculate the selling price per unit for product DG that shouldbe set in order to maximize weekly profit. (c) Distinguish briefly between penetration and skimming pricingpolicies when launching a new…
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BVM manufactured and sold 25,000 small statues this past year. At that volume, the firm was exactly in a breakeven situation in terms of profitability. BVM’s unit costs are expected to increase by 30% next year. What additional information is needed to determine how much the production volume/sales would have to increase next year to just break even in terms of profitability? (a) Costs per unit (b) Sales price per unit and costs per unit (c) Total fixed costs, sales price per unit, and costs per unit (d) No data is needed, the volume increase is 25, 000 + 25, 000(0.30) = 32, 500 units.
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