the envelope curve be tangential to the bottom of each of the short-run average cost curves? Explain why it should or should not be

Q: Which of the following describes increasing returns to scale?     A. Long Run Average Total Costs…

A: The total cost of production refers to the monetary value of inputs used in the production of goods…

Q: Refer to the Long Run Average Total Cost curve below to answer the following questions:

A: Economies of scale occurs when LRAC decreases as output increases. In the given curve, LRAC…

Q: When economist Jacob Viner first developed the envelope relationship, he told his draftsman to make…

A: The Long Run Average Cost (LAC) is calculated by dividing long run total costs by the amount of…

Q: Suppose the hourly wage is $20 and the price of each unit of capital is $2. The price of output is…

A: The firm maximizes profit by hiring the number of workers at a point where MPE = w/p

Q: If a person starts their own business, one implicit cost is the loss of a steady salary from leaving…

A: This statement is True Implicit cost is the opportunity cost of the foregone alternative which is…

Q: Which of the following statements best represents a difference between short-run and long-run cost?…

A: In the production function, different inputs are used to produce the final output. Each input has…

Q: How is the short-run average cost curve and the long-run average cost curve-shaped? What is the…

A: Short run average cost has fixed factors of production,whereas in long run average cost there are no…

Q: Given the average-cost function AC=Q^2-4Q+174, find the MC function. Is the given function more…

A: Average Cost (AC) function is given as:

Q: The long run average cost curve is U shaped because up to a certain point you have excess K/L and…

A: Total cost refers to the total amount of expenditure incurred by the firm ti produce the given…

Q: Please define the long cost curve and the short run cost curve in your own words but not more than…

A:

Q: Which of the following is always downward-sloping? a. The marginal cost curve when it is below the…

A: The firms, producers, and sellers are considered to one of the major players in the markets. The…

Q: short-run with a fixed amount of at least one input, the Law of Diminishing Returns must apply,…

A: The law of deminishing marginal returns is one of the key standards of financial matters and is…

Q: Consider the following types of firms. For each one, the long-run average cost curve eventually…

A: The expenses that are being incurred for carrying out transactions of the business are known as…

Q: "Whenever a number which is less than the previous average of a total is added to that total, the…

A: In a market, it can be seen that the different cost curves are directly or indirectly related to…

Q: Both short-run and long-run average cost curves are likely to have a negative slope up to a given…

A: Meaning of Short-Run Cost Curves: The term short-run cost is the period under which some variable…

Q: Suppose that the cost of all inputs (both labor and capitol) decreases. What will happen to the…

A: In economics, inputs are considered as factors of production. That means, inputs are those factors…

Q: Modified True or False: State whether each statement is true or false. If the statement is false,…

A: The diminishing returns occurs in the short run. All factor of production are not variable in the…

Q: Over the positively sloped portion of the short-run average cost curve, the effect of productivity…

A: In the short-run , the average cost curve is the sum of total variable cost and total fixed cost.…

Q: What is the difference between production in the short run and production in the long run? Explain…

A: The short-run is a notion that states that at least one input is fixed while the others are variable…

Q: Average cost curves (except for average fixed cost) tend to be U-shaped, decreasing and then…

A: Total Costs  = Variable costs + Fixed costs AC = AFC + AVC

Q: Average cost curves (except for average fixed cost) tends to be u-shaped , decreasing and then…

A: Marginal cost is nothing but the additional cost required to produce one extra unit while average…

Q: Which of the following is always downward-sloping?  a. The marginal cost curve when it is below the…

A: Marginal cost refers to change in total cost with respect to change in output. Average total cost…

Q: rising with output increase Long Run Average Total Costs are decreasing with output increase  Long…

A: Increasing returns to scale occurs when the output tends to increase in a greater proportion as…

Q: For the following industries, state whether the long-run average cost curve has an extended range…

A: Returns to scale is the quantitative change in outputs of an industry or firm in response to an…

Q: Explain the general shape of the long run cost curves in relation to economies and diseconomies of…

A: The shape of long run cost curve changes depending on the returns to scale.

Q: Explain why an increase in the price of an input must typically cause an increase in the long-run…

A: As we know in long run , firms can increase both factors simultaneously and due to this firm…

Q: Explain the following statement by using a graphical analysis: “Shape of the short-run cost curves…

A: The shape of the short-run total cost (TC) curve is cubic and that of the average cost (AC) curve is…

Q: The economies-of-scale curve is a long-run average cost curve, because       it allows all factors…

A: Basics:- Short run:- It is a period of time in which fixed cost remains constant because all factors…

Q: Explain why the red curve is an incorrect representation of a long-run average cost curve. Note: the…

A: The average cost is the called the per unit cost of production. The AC = TC/Q. The long run Average…

Q: The following table describes the various least cost combinations of two inputs from various…

A: Iso quant shows the different possibil combinations of inputs that give same level of output . And…

Q: What is the difference between production in the short run and production in the long run? Explain…

A: please find the answer below.

Q: Give few examples of "Sunk Cost" from your real-life experience.

A: Money that was already spent that cannot be recovered is referred to as a sunk cost. The axiom that…

Q: Why would labor be treated as a variable cost? Question 24 options: they are costs…

A: Variable cost is that cost which changes when the output level changes. It depends on the quantity…

Q: Show the relationship between short-run marginal and average cost curves, and long-run marginal and…

A: In the short run there are two types of costs:- fixed costs and variable costs. In the short run…

Q: A downward-sloping portion of a long-run average total cost curve is the result of

A: The term scale of production refers to the dimension of a firm. A small-sized firm defers lower…

Q: Question 19 Which of the following statements best represents a difference between short-run and…

A: In economics, the concept of short-run and long-run is used to analyze the variability of various…

Q: Why would labor be treated as a variable cost? labor costs will decrease as the firm produces more…

A: Fixed cost refers to the cost which remains same at all levels of output. It is independent of…

Q: Distinguish between economies of scale and constant returns to scale. What shape will the long-run…

A: Economies of scale – A downward sloping LARC (Long run average cost curve)The constant return to…

Q: Complete the table above Solve the short run production function every of the above table.

A: Marginal Product of worker shows the number of extra units of yield (amount) each extra worker…

Q: Explain how a change in the price of one input factor changes a firm’s long-run expansion path?

A: The firms, and businesses are the entities who are considered to be of utmost importance for the…