We know there is a link between productivity and costs. For example, recall the link between the marginal physical product of the variable input and marginal cost. With this in mind, what link might there be between productivity and prices?

Q: How does a cost behave in response to a change in activity? Give an example?

A: Cost also changes with the change in the activity. There are two types of costs- fixed costs and…

Q: Answer the following with the required graph. a) Describe the shape of the average fixed cost. b)…

A: The money spent to purchase the fixed and variable factor of production to produce the goods and…

Q: Which of the following is true of fixed costs?   a. Fixed costs can be changed, but it is…

A: Fixed costs are those that do not change with changes in the output level produced. They are the…

Q: Explain why the fixed cost has no influence at all on marginal cost.

A: In the short run, a firm will have two types of cost: fixed cost and variable cost. Total variable…

Q: An individual is both the owner and the manager of a shop taken on rent. Identify implicit cost and…

A: Explicit cost:- Standard business costs that appear in the accounting records and have a direct…

Q: What effect, if any, does diminishing marginal product have on the shape of the marginal cost curve?

A: According to the law of diminishing marginal returns, after a certain level adding additional units…

Q: Explain the consequences to the farmer if the production function for milk were a linear function of…

A: The production function is the total amount of output which would result in the maximum amount of…

Q: Consider the table below that describes the costs associated with producing a good (Q). Total…

A: Marginal cost refers to the additional cost of producing one more unit of output.

Q: Explain how input, output and cost are interrelated

A: A business needs to make use of inputs for turning them into outputs that could finally be sold in…

Q: Ontario is removing vehicle license renewal fees (article below). How does this affect the cost of…

A: Understanding the impact of eliminating licence renewal fees on automobile ownership costs is the…

Q: Use the cost table below to find the following marginal costs.   Output quantity Total variable cost…

A: Marginal cost is the additional cost incurred from producing an additional unit of output.

Q: Draw a production function that exhibits diminishing marginal product of labour. Draw the associated…

A:

Q: Give two example of fixed cost

A: Cost is the total expenditure incurred by a producer in producing a good or services. Cost has two…

Q: Illustrate the link between the cost-minimization problem and total cost curve. What would happen to…

A: Cost minimization is a fundamental rule utilized by makers to figure out what blend of work and…

Q: You are an employer seeking to fill a vacant position on an assembly line. Are you more concerned…

A:

Q: Draw a production function that exhibits diminishing marginal product of labor. Draw the associated…

A: The diminishing product of labor refers to the situation where increasing one additional labor…

Q: Give a numerical example to show that as marginal physical product (MPP) rises, marginal cost (MC)…

A: Marginal Physical Product (MPP) is the addition to the total physical product when an additional…

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: True or False? This marginal cost function is the derivative of the production function.

A: We have, Cw1,w2,y=w113+w2133y2 The marginal cost  MC = Cyw,y It means the C(w1,w2,y) function is…

Q: Suppose that the marginal cost of producing a pound of cereal is $2, irrespective of the level of…

A: Marginal cost is in addition to total cost because of producing one more unit of output. Average…

Q: True or False The slope of the total cost curve is equal to marginal cost, or the change in…

A: Total cost It refers to all the cost or expense that is incur in a production process.It is given by…

Q: Assume that Alex uses capital and labour to produce a good. The unit price of capital is $2 and the…

A: Here we calculate the amount of additional labor if Alex want to incur the same cost  by using the…

Q: Which of the following is NOT a feature of iso-product curve? Iso- product curves

A: An iso-product curve is locus of numerous mixtures of elements of manufacturing giving the identical…

Q: State two examples of the fixed cost and two examples of the variable cost in economics

A: According to the given question Fixed cost are those cost in economics which are basically and…

Q: You are told that the marginal cost of production is increasing. Is it possible to determine whether…

A: Marginal cost of production refers to the additional cost of producing one extra unit of output,…

Q: ( Relationship Between Marginal Cost and Average Cost ) Assume that labor and capital are the only…

A: Fixed cost is independent of output produced. Whereas variable cost varies with the level of…

Q: A firm is using 7 units of labor and 100 units of capital to produce 1000 units of goods. At these…

A: The problem of reducing costs is, in mathematics, a problem. In limited optimization. The firm wants…

Q: Which of the following statement is correct? a. Marginal cost will equal average total cost when…

A: Let's first understand what's the meaning of marginal cost. The cost which is incurred on the…

Q: Why might marginal product be increasing at lower levels of output and decreasing at higher levels…

A: Marginal product (MP) is the extra output produced by one additional unit of input or raw material…

Q: What is direct cost? What is indirect cost? Provide detailed definitions and  example for both

A: The total cost of a product is generally categorized into direct and indirect costs.

Q: A firm's production function is Q = min ( K, 2L ) , where Q is the number of units of output per day…

A: Long-run average total cost (LRATC) is a business measure that indicates the long-run average cost…

Q: Which is the correct formula for the total cost of production?Note: TC is total Cost, AFC is average…

A: TC is the total cost of producing output TFC is the total fixed cost of producing output. It remains…

Q: With appropriate examples explain how marginal cost is related only to total variable cost.

A: Cost Cost refers to the actual expenditure on inputs (i.e. explicit cost) and the imputed value of…

Q: Explain the difference between fixed cost and the variable cost in economics.

A: In economics, cost refers to all the expense that has been incurred in order to produce goods and…

Q: A firm faces the following production function: y(k, 1) = √k + √l. The output price is equal to 6,…

A: The firm is at optimum when it hires the number of input at a level where marginal product of the…

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

A: Average cost is the per unit cost of production. it is the ratio of total cost and output.  Marginal…