LSC CUMBERLAND EC202 MICRO>PKG<
21st Edition
ISBN: 9781260586992
Author: McConnell
Publisher: MCG
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Question
Chapter 11, Problem 6DQ
To determine
Economic profit and innovation.
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Figure 7.7. What is the marginal gainin output from increasing the number of barbers from4 to 5 and from 5 to 6? Does it continue the pattern ofdiminishing marginal returns?
Suppose that the pen-making industry is perfectly competitive. Also suppose that each current firm and any potential firms that might enter the industry all have identical cost curves, with minimum ATC = $1.25 per pen. If the market equilibrium price of pens is currently $1.50, what would you expect it to be in the long run? LO11.2 a. $0.25. b. $1.00. c. $1.25. d. $1.50.
4. Various measures of cost
Suppose the imaginary company of Roobek is a small, Jackson-based American apparel manufacturer specializing in athleisure. The following table
presents the brand's total cost of production at several different quantities.
Fill in the remaining cells of the following table.
Quantity Total Cost Marginal Cost
(Pairs) (Dollars) (Dollars)
0
1
2
3
4
LO
5
6
120
200
240
285
340
425
540
Fixed Cost Variable Cost
(Dollars) (Dollars)
Average Variable Cost
(Dollars per pair)
Average Total Cost
(Dollars per pair)
Chapter 11 Solutions
LSC CUMBERLAND EC202 MICRO>PKG<
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- 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.arrow_forwardGive type answer i will Ratearrow_forwardScenario 5.1 A dentist's practice is organized as a sole proprietorship. Last year the dentist's tota revenue was $320,000 and total costs were $250,000. The dentist left a job paying $112,000 a year to start the sole proprietorship. Question: According to the information in Scenario 5.1, how much accounting profit did the dentist make last year? O $208,000 O $112,000 O $320,000 O $70,000arrow_forward
- You are the owner and only employee of a company that sets odds for sporting events. Last year you earned a total revenue of $100,000. Your costs for rent and supplies were $50,000. To start this business you invested an amount of your own capital that could pay you a return of $20,000 a year. Your economic profit last year was O $50,000 O $60,000 O $10,000 O $30,000arrow_forwardIndustry Z is made up of the following firms. One firm makes up 40% of the total market sales, one of the firms make up 25%, one of the firms make up 20%, one firm makes up 10%, and the remaining firms make up 5% of the total market sales. What is the HHI for this industry? O 2,730 O 95 O 1.800 O 1,200arrow_forward1arrow_forward
- LO 11.2: I can calculate marginal cost, revenue, and profit and distinguish between marginal cost and average cost. Suppose that Patrick's Handmade Puppets has a production cost that is given by C(x) = 2,000 + 130x – 0.6x2 + 0.002x3 dollars (0arrow_forwardLAST WORD Suppose that minimum efficient scale for producing items with a 3-D printer is 100 times what a typical family would consume in a year Would you expect each family to have its own 3-D printer? What sort of industry structure might arise?arrow_forwardq 0 1 2 3 4 5 6 TFC $5 5 5 5 5 5 5 TVC $0 3 LO 5 9 16 25 36 MC - $3 2 4 7 9 11 P = MR $5 5 5 5 LO 5 5 5 A profit-maximizing firm should produce a quantity of TR $0 5 10 15 20 25 30 TC $5 8 10 14 21 30 41 Profit $-5 - 3 0 1 - 5 11 units. (Enter your response as a whole number.)arrow_forwardInnovation can take many forms. Discuss TWO examples of product/service, process, position, or paradigm innovations that you felt most suited to the Aura Bengkang Enterprise.. Hafiz is looking at how he can develop strategic advantages for his business. Suggest and discuss TWO strategic advantages through innovation that you think are relevant to Mr. Hafiz’s business. Explain to Mr. Hafiz THREE critical factors of new product success.arrow_forwardConsider a small landscaping company run by Mr. Viemeister. He is considering increasing his firm’s capacity. If he adds one more worker, the firm’s total monthly revenue will increase from $50,000 to $58,000. If he adds one more tractor, monthly revenue will increase from $50,000 to $62,000. Each additional worker costs $4,000 per month, while an additional tractor would also cost $4,000 per month. LO16.5 a. What is the marginal product of labor? The marginal product of capital? b. What is the ratio of the marginal product of labor to the price of labor (MPL/PL)? What is the ratio of the marginal product of capital to the price of capital (MPK/PK)? c. Is the firm using the least-costly combination of inputs? d. Does adding an additional worker or adding an additional tractor yield a larger increase in total revenue for each dollar spent?arrow_forwardSuppose that the paper clip industry is perfectly competitive. Also assume that the market price for paper clips is 2 cents per paper clip. The demand curve faced by each firm in the industry is: LO10.3 a. A horizontal line at 2 cents per paper clip. b. A vertical line at 2 cents per paper clip. c. The same as the market demand curve for paper clips. d. Always higher than the firm’s MC curve.arrow_forwardarrow_back_iosSEE MORE QUESTIONSarrow_forward_ios
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