Take a look at the below graph and suppose that the price per unit corresponding the position of d 2 is at $2.50 per unit and that the quantity at point E 2 is exactly 5 units per hour. Calculate total revenues and total variable costs at point E 2 and explain why it’s called the short run shut down point. Concept Introduction: Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity. Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula. Total variable cost Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

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Answer 1

Question

Chapter 23, Problem 17P

To determine

Take a look at the below graph and suppose that the price per unit corresponding the position of d₂ is at $2.50 per unit and that the quantity at point E₂ is exactly 5 units per hour. Calculate total revenues and total variable costs at point E₂ and explain why it’s called the short run shut down point.

Concept Introduction:

Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity.

Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula.

Total variable cost

Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

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Answer 2

Question

Chapter 23, Problem 17P

To determine

Take a look at the below graph and suppose that the price per unit corresponding the position of d₂ is at $2.50 per unit and that the quantity at point E₂ is exactly 5 units per hour. Calculate total revenues and total variable costs at point E₂ and explain why it’s called the short run shut down point.

Concept Introduction:

Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity.

Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula.

Total variable cost

Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

Expert Solution & Answer

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Answer 3

Question

Chapter 23, Problem 17P

To determine

Take a look at the below graph and suppose that the price per unit corresponding the position of d₂ is at $2.50 per unit and that the quantity at point E₂ is exactly 5 units per hour. Calculate total revenues and total variable costs at point E₂ and explain why it’s called the short run shut down point.

Concept Introduction:

Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity.

Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula.

Total variable cost

Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

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Answer 4

Question

Chapter 23, Problem 17P

To determine

Take a look at the below graph and suppose that the price per unit corresponding the position of d₂ is at $2.50 per unit and that the quantity at point E₂ is exactly 5 units per hour. Calculate total revenues and total variable costs at point E₂ and explain why it’s called the short run shut down point.

Concept Introduction:

Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity.

Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula.

Total variable cost

Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

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Answer 5

Chapter 23, Problem 17P

To determine

Take a look at the below graph and suppose that the price per unit corresponding the position of d₂ is at $2.50 per unit and that the quantity at point E₂ is exactly 5 units per hour. Calculate total revenues and total variable costs at point E₂ and explain why it’s called the short run shut down point.

Concept Introduction:

Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity.

Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula.

Total variable cost

Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

Answer 6

Chapter 23, Problem 17P

To determine

Take a look at the below graph and suppose that the price per unit corresponding the position of d₂ is at $2.50 per unit and that the quantity at point E₂ is exactly 5 units per hour. Calculate total revenues and total variable costs at point E₂ and explain why it’s called the short run shut down point.

Concept Introduction:

Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity.

Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula.

Total variable cost

Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

Answer 7

Chapter 23, Problem 17P

To determine

Take a look at the below graph and suppose that the price per unit corresponding the position of d₂ is at $2.50 per unit and that the quantity at point E₂ is exactly 5 units per hour. Calculate total revenues and total variable costs at point E₂ and explain why it’s called the short run shut down point.

Concept Introduction:

Total revenue: Total revenue is the sum of all revenue resulting from the sales. The total revenue is calculated by multiplying price by quantity.

Total variable cost: Total variable cost is the variable costs of the firm that varies with the output. It is the costs of production. It can be calculated by the following formula.

Total variable cost

Shutdown point: Shutdown point is the point where price is equal to total variable cost (TVC). Firms derives no benefit at this point. The firm is indifferent whether to shut down or produce.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 23 - Prob. 23.1LO Ch. 23 - Prob. 23.2LO Ch. 23 - Prob. 23.3LO Ch. 23 - Prob. 23.4LO Ch. 23 - Prob. 23.5LO Ch. 23 - Prob. AFCT Ch. 23 - Prob. BFCT Ch. 23 - Prob. CFCT Ch. 23 - Prob. 1CTQ Ch. 23 - Prob. 2CTQ

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Chapter 23 Solutions