Gen Combo Microeconomics; Connect Access Card
21st Edition
ISBN: 9781260044874
Author: MCCONNELL CAMP
Publisher: MCG
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Question
Chapter 9, Problem 3P
To determine
Change in the average fixed cost, marginal cost and breakeven price.
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Let's explore how rising costs helped to kill off most printed newspapers after the Internet became available in the mid-1990s. Imagine
that you are a newspaper publisher in the year 2004. You are in the middle of a one-year factory rental contract that requires you to
pay $700,000 per month, and you have contractual salary obligations of $1,250,000 per month that you can't get out of. You also have
a marginal printing cost of $0.35 per paper as well as a marginal delivery cost of $0.10 per paper.
Instructions: Enter your answers rounded to two decimal places.
a. If sales fall by 20 percent from 1,000,000 newspapers per month to 800,000 newspapers per month, what happens to the AFC per
newspaper?
AFC per newspaper (Click to select) : from $
b. What happens to the MC per newspaper?
MC per newspaper (Click to select) ÷
c. What happens to the minimum amount that you must charge to break even?
It (Click to select) : from $
to $
You are a newspaper publisher. You are in the middle of a one-year factory rental contract that requires you to pay $500,000 per
month, and you have contractual salary obligations of $1,250,000 per month that you can't get out of. You also have a marginal
printing cost of $0.25 per paper as well as a marginal delivery cost of $0.10 per paper.
Instructions: Enter your answers rounded to two decimal places.
a. If sales fall by 20 percent from 1,000,000 newspapers per month to 800,000 newspapers per month, what happens to the AFC per
newspaper?
AFC per newspaper (Click to select) v from $
to $
b. What happens to the MC per newspaper?
MC per newspaper (Click to select) v
c. What happens to the minimum amount that you must charge to break even?
It (Click to select) v from $
to $
You are a newspaper publisher. You are in the middle of a one-year rental contract for your factory that requires you to pay $600,000 per month, and you have contractual labor obligations of $1,250,000 per month that you can’t get out of. You also have a marginal printing cost of $0.35 per paper as well as a marginal delivery cost of $0.10 per paper.
Instructions: Round your answers to 2 decimal places.
c. What happens to the minimum amount that you must charge to break even on these costs?
It increases from $...........per paper to $2.76.
what is the price for paper?
Chapter 9 Solutions
Gen Combo Microeconomics; Connect Access Card
Ch. 9.2 - Prob. 1QQCh. 9.2 - Prob. 2QQCh. 9.2 - Prob. 3QQCh. 9.2 - Prob. 4QQCh. 9.5 - Prob. 1QQCh. 9.5 - Prob. 2QQCh. 9.5 - Prob. 3QQCh. 9.5 - Prob. 4QQCh. 9.8 - Prob. 1QQCh. 9.8 - Prob. 2QQ
Ch. 9.8 - Prob. 3QQCh. 9.8 - Prob. 4QQCh. 9 - Prob. 1DQCh. 9 - Prob. 2DQCh. 9 - Prob. 3DQCh. 9 - Prob. 4DQCh. 9 - Prob. 5DQCh. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Prob. 1RQCh. 9 - Which of the following are short-run and which are...Ch. 9 - Prob. 3RQCh. 9 - Indicate how each of the following would shift the...Ch. 9 - Prob. 5RQCh. 9 - Prob. 6RQCh. 9 - Prob. 1PCh. 9 - Prob. 2PCh. 9 - Prob. 3PCh. 9 - Prob. 4P
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