Principles of Economics (12th Edition)
12th Edition
ISBN: 9780134079271
Author: CASE
Publisher: PEARSON
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Question
Chapter 9, Problem 2.9P
To determine
Short run average cost curve, short run marginal cost curves and long run average cost curves.
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The long-run average cost curve for an industry is represented in the following graph. Add short-run average cost curves and short-run marginal cost curves for three firms in this industry, with one firm producing an output of 10,000 units, one firm producing an output of 20,000, and one firm producing an output of 30,000. Label these as Scale 1, Scale 2, and Scale 3, respectively. What is likely to happen to the scale of each of these three firms in the long run?.
An economist estimated that the cost function of a single-product firm is:
C(Q) = 100 + 20Q + 15Q2 + 10Q3
[NOTE à MC(Q) = 20+30Q+30Q2]
Based on this information, determine:
The fixed cost of producing 10 units of output
The variable cost of producing 10 units of output
The total cost of producing 10 units of output
The average fixed cost of producing 10 units of output
The average variable cost of producing 10 units of output
The average total cost of producing 10 units of output
The marginal cost when Q = 10
In a furniture market, if a furniture company is analyzing the short run total costs, one of the following business practices would be beneficial. Which one?
divide the variable costs of production by the quantity of output
divide the total costs of production by the quantity of output
divide total costs into two categories: fixed costs that can't be changed in the short run and variable costs that can be.
divide total costs into two categories: variable costs that can't be changed in the short run and fixed costs that can be
Chapter 9 Solutions
Principles of Economics (12th Edition)
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