EP ECONOMICS,AP EDITION-CONNECT ACCESS
20th Edition
ISBN: 9780021403455
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 26, Problem 6P
To determine
Per unit cost of an application.
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Students have asked these similar questions
We have been asked to analyze our toy products by
price (from $10.00 to $13.00 by 0.25) and quantity
(from 3,000 to 30,000 by 3,000).
Fixed Cost = $94,550 Material cost per toy =
$4.77
Labor cost per toy $3.17
When the profit $1,210, what was the quantity
produced and the price per toy?
O 24.000 toys @ $12.00 cach
O 21.000 toys @ $12.50 cach
15.000 toys e $11.00 cach
What is the Average Total Cost (ATC) for producing 84 units of output?
Quantity of Labor
5
7.4
7
7.62
0
1
2
3
4
сл
5
LO
6
Total Output
0
16
40
60
72
80
84
Fixed Cost
$160
Variable Cost
$80
$160
$240
$320
$400
$480
Total Cost
The table below shows cost data for producing different amounts of cough syrup. Use the given information to find the
missing cost data.
Quantity
0
1
2
3
4
LO
5
Total Cost in $
120
150
206
556
->
Average Fixed Cost in $ Average Variable Cost in $
60
30
24
9.
30
22.5
28.6666666666667
47.25
->
Marginal Cost in $
30
15
103
247
←
Chapter 26 Solutions
EP ECONOMICS,AP EDITION-CONNECT ACCESS
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Similar questions
- 1. Suppose that Bill owns a vehicle smash repair shop. The table below shows how the quantity of cars Bill can repair per month depends on the number of workers that he hires. Assume that he pays each worker $4000 per month and his fixed costs are $6000 per month. Using the information provided, complete the table. QUANTITY QUANTITY OF OF CARS PER WORKERS MONTH 0 1 2 3 4 LO 5 0 20 30 40 50 55 FIXED COSTS $6000 VARIABLE COSTS TOTAL COST AVERAGE TOTAL COSTarrow_forwardThe graph below shows the market for oats. Price per bushel 10 9 8 7 6 LO 5 4 3 2 1 0 15 45 30 75 105 135 120 150 60 90 Quantity per period (in millions of bushels) D Tools S₂ (i)arrow_forwardAverage total cost tells us the O 1) cost of the last unit of output, if total cost does not include a fixed cost component. 2) variable cost of a firm that is producing at least one unit of output. 3) O 4) total cost of the first unit of output, if total cost is divided evenly over all th units produced. cost of a typical unit of output, if total cost is divided evenly over all the uni produced.arrow_forward
- 4.Distinguish between explicit and implicit costs, giving examples of each. What are some explicit and implicit costs of attending college? LO2arrow_forwardConsider the following production schedule: Output per hour Total Cost 0 $ 1 $ $ $ $ 4.00 7.00 8.00 12.50 17.20 $ 22.00 $ 29.00 In the above table, the firm's total fixed cost of production is 2 3 4 5 сл LO 6 $99.70 $4 $29 $3 $7arrow_forward8. Why can the distinction between fixed costs and variable costs be made in the short run? Classify the following as fixed or variable costs: advertising expenditures, fuel, interest on company-issued bonds, shipping charges, payments for raw materials, real estate taxes, executive salaries, insurance premiums, wage payments, sales taxes, and rental payments on leased office machinery. LO4arrow_forward
- Can a firm have a production function that exhibits increasing returns to scale, constant returns to scale, and decreasing returns to scale as output increases? Discuss. O A. No. The functional form of the production technology dictates the type of returns to scale it exhibits. While a production function can exhibit both increasing returns and constant returns to scale at different levels of output, increasing returns and decreasing returns to scale are mutually exclusive. O B. Yes. At low levels of output, specialization leads to increasing returns to scale. Once specialization has been exhausted, proportional increases in all inputs lead to constant returns to scale. And finally, for large scale operations, logistical and bureaucratic problems can lead to decreasing returns to scale. O C. No. The functional form of the production technology dictates the type of returns to scales it exhibits, and there will only be one of the three types of returns to scale exhibited throughout the…arrow_forwardUsing the table below and a benchmark year of 1992, what is the output index for 1988? YEAR 1988 1992 1996 0.872 O 0.698 O 1.432 O 1.146 BEET PRODUCTION (TONS) 4,598 6,584 7,548 OUTPUT INDEX 1.00 PRICE OF BEETS ($/TON) $0.557 $0.697 $0.856 PRICE INDEX 1.000arrow_forwardgiven: production=150,000 unit unit price= $ 25 Fixed Cost Variable Cost Design ($/x) 20.5x $100,000 revenue equation =???? O 25 O 25x 100,000-20.5x 15,000x 100,000+20.5xarrow_forward
- According to Little's Law, which statement is correct for a stable process: O a. For a given throughput, the average inventory is independent of the average flow time O b. For a given throughput, increasing the average inventory results in an increase in the average flow time. O c. For a given throughput, decreasing the average inventory results in an increase in the average flow time. O d. For a given throughput, increasing the average inventory results in a reduction in the average flow time.arrow_forwardWhich statement is correct? Choose an answer O 1. The average fixed costs increase with the production volume. O 2. The average total costs are minimal when the average fixed costs are equal to the average variable costs. O 3. In the long term, it pays to maintain production operations as soon as a positive contribution margin is generated. O 4. The operating optimum is where the marginal costs intersect the average variable costs. O 5. As long as the marginal costs are below the average total costs, the average total cost.arrow_forwardSuppose that a business incurred implicit costs of $300,000 and explicit costs of $1,300,000 over the past year. If the firm sold 70,000 units at $20 per unit, its accounting: O profits were $400,000 and its economic profits were $100,000 O profits were $100,000 and its economic profits were zero. O profits were $100,000 and its economic losses were $200,000 O losses were $200,000 and its economic profits were $100.000. tv MacBook Pro DOD 000 F4 F8 19 F5 F6 F7arrow_forward
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