ECON: MICRO4 (New, Engaging Titles from 4LTR Press)
4th Edition
ISBN: 9781285423548
Author: William A. McEachern
Publisher: Cengage Learning
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Concept explainers
Question
Chapter 7, Problem 3.9PA
To determine
To determine:
The values of
Concept Introduction:
Average variable cost (avc) = total variable cost (tvc)/quantity
Average total cost (atc) = total cost (tc)/quantity
Marginal cost (mc) =change in total cost/change in quantity
Expert Solution & Answer
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Question-1
The table below shows the short run cost for producing bicycles.
Complete all missing values in table below:
Marginal cost
Average total cost
Average variable cost
Average fixed cost
Total cost
Variable cost
Fixed cost
Output
Labor
0
$60
0
0
70$
$60
1
1
$140
$60
6
2
$210
$60
11
3
280$
$60
15
4
$350
$60
13
5
$420
$60
12
6
Draw the short run total cost curve (show the total cost, fixed cost, variable cost).
Where the marginal cost and average total cost intercept? Explain the relationship between the marginal cost and the average total cost with the help of graph.
Microeconomics - Production FunctionA firm produces shoes using labor (L) and machinery (K) as factors of production. Its production function is Q = K1/3 * L2/3. Answer:(a) is the marginal product of labor (MPL) decreasing?b) is the average product of labor (APL) decreasing?c) what is the relationship between the average product (AP) and marginal product (MP) curves?d) what type of returns to scale does Q exhibit?
Question 24.24. Variable costs are
sunk costs.
costs that change every day.
costs that change with the level of production.
the change in total cost due to the production of an additional unit of output.
Chapter 7 Solutions
ECON: MICRO4 (New, Engaging Titles from 4LTR Press)
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- What shapes would you generally expect each of the following cost curves to have: fixed costs, variable costs, marginal costs, average total costs, and average variable costs?arrow_forwardHow do we calculate each of the following: marginal cost, average total cost, and average variable cost?arrow_forwardQuestion 17 The ________ marginal product of labor occurs because the amount of fixed inputs per labor declines as more workers are hired.The average product of labor__________ if the marginal product of labor is greater than the average product of labor.Increasing: DecreasesDiminishing: DecreasesDiminishing: Increases Increasing: Increasesarrow_forward
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