5CUPS OF COFFEE432KGraph (a)13NM2345 6DONUTSRefer to Figure 2-4, Graph (a). Production isO a. possible at points J, L, M, and N, but efficient only at points J, L, and M.O b. possible at points J, K, L, and M, but efficient only at point K.O c. possible at points J, L, M, and N, but efficient only at point N.O d. possible at points J, K, L, and M, but efficient only at points J, L, and M.CUPS OF COFFEE5321Graph (b)12345 6DONUTS

The graph (a) shows the production possibility frontier (PPF) curve. Now, a production possibility…

Answered: 5 CUPS OF COFFEE 4 3 2 K Graph (a) 13 N…

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 21P

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JYour business has the capacity to produce up to 5 units/week. The table & graph below show average cost (AC) for different weekly production levels. Your objective is to maximize profit each week. Average Cost 22 20 AC 18 1 20 14 2 15 12 3 12 10 1 2 4 4 13 Quantity 15 Your product sells in the market for $21/unit, and you can sell as many units at that price as you can bring to market. You know from your economics training that deciding how much to produce should rely on marginal concepts like marginal cost (MC). So, based on the AC table above, create a table that shows the MC of each unit. (Assume that there are no fixed costs, so total costs are zero if Q=0.) Based on MC for each unit, determine the profit-maximizing quantity to produce and sell. BRIEFLY explain your answer. (Your answer needs to be based on MC and being able to sell each unit for $21.) AC ($/unit)
4. Complete the table below Output VC FC TC AVC AFC ATC 30 4 2 40 3. 48 4 63 5 46 6. 70
l alfa 8-19 am 1. Which of the following remains constant as output increases? * O a. TFC O b. TVC O c. TC d. All of the above Ruepue is $45
Principles of Microeconomics Name: Homework #3 Prof. R. Harris DUE: Wednesday, April 17, 2019 at the beginning of class - NO EXCEPTIONS. Please remember to show all work and please be neat. Please staple this if you print it on your own. 1. Consider the following table of numbers, which represents demand and cost conditions for a com firm. petitive TR 600 0 1 2 $o $400 600 $400 $240 600 $430 $670 $960 $1,350 $1,840 $2,440 $3,120 $3,910 $4,800 600 600 600 600 600 600 5 6 7 600 600 9 10 (a) Fill in the missing values (b) Use the information in the chart to determine what level of output the firm should produce. Explain your reasoning.
Juanita and Shantala run a business that programs and tests cellular phones. Assume that Juanita and Shantala can switch between programming and testing cellular phones at a constant rate. The following table applies. Minutes Needed to Number of Cellular Phones Programmed or Tested in a 40-Hour Week Program 1 Test 1 Cellular Phones Cellular Phones Cellular Phone Cellular Phone Programmed Tested Juanita 160 1200 Shantala 10 4. 240 600 Shantala has an absolute advantage in O a. programming cellular phones and a comparative advantage in testing cellular phones. O b. testing cellular phones and a comparative advantage in programming cellular phones. O c. testing cellular phones and a comparative advantage in testing cellular phones. O d. programming cellular phones and a comparative advantage in programming cellular phones.
Ike's Bikes is a major manufacturer of bicycles. Currently, the company produces bikes using only one factory. However, it is considering expanding production to two or even three factories. The following table shows the company's short-run average total cost each month for various levels of production if it uses one, two, or three factories. (Note: Q equals the total quantity of bikes produced by all factories.) Average Total Cost (Dollars per bike) Number of Factories Q = 100 O = 200 O = 300 Q = 400 O = 500 O = 600 1 260 200 160 200 280 400 2 330 240 160 160 240 330 400 280 200 160 200 260 Suppose Ike's Bikes is currently producing 100 bikes per month in its only factory. Its short-run average total cost is $ per bike. kes Suppose Ike's Bikes is expecting to produce 100 bikes per month for several years. In this case, in the long run, it would choose to produce using On the following graph, plot the three short-run average total cost curves (SRATC) for Ike's Bikes from the previous…
You own a printing firm. Two of yoursenior managers provide you with advice. Thefirst manager states that your company islosing money for every unit that is printed. Tominimize losses, she advises that you reduceyour production levels. The second managerstates that if your firm sells some more units,the price will cover your increase in costs. Inorder to reduce losses, the second managerrecommends that you should increaseproduction. Explain which manager iscorrect and who is offering the correctadvice?
2. Inputs and outputs Kevin's Performance Pizza is a small restaurant in Chicago that sells gluten-free pizzas. Kevin's very tiny kitchen has barely enough room for the two ovens in which his workers bake the pizzas. Kevin signed a lease obligating him to pay the rent for the two ovens for the next year. Because of this, and because Kevin's kitchen cannot fit more than two ovens, Kevin cannot change the number of ovens he uses in his production of pizzas in the short "un. 因 However, Kevin's decision regarding how many workers to use can vary from week to week because his workers tend to be students. Each Monday, Kevin lets them know how many workers he needs for each day of the week. In the short run, these workers are inputs, and the ovens are inputs. Kevin's daily production schedule is presented in the following table. Fill in the blanks to complete the Marginal Product of Labor column for each worker. Labor Output Marginal Product of Labor (Number of workers) (Pizzas) (Pizzas) 1.…
5. The graph below shows the Price, Marginal Cost, and Average Total Cost curves for the production of Beanie Weenie Dog (a new item served at Tropicana Field -deep-fried hot dog wrapped in bacon, covered with baked beans). I will not be trying it. Will you?_ price 400 380 MC 360 340 АТС 320 300 280 260 240 220 200 180 160 140 120 100 80 60 40 20 0 P MR o 1 2 3 4 5 6 7 8 9 1o 11 Quantity a. What is the profit-maximizing level of Beanie Weenie Dogs that should be produced? b. At the level that you found in part (a), what is the firm's profits or loss? Show your calculations. c. Calculate what the firm's profits or losses are if instead of choosing the level you found in part (a), the firm chooses to produce at one unit above that level. d. Calculate what the firm's profits or losses are if instead of choosing the level you found in part (a) firm chooses to produce at one unit below that level.
1. A firm has three different production facilities, all of which produce the same product. Whilereviewing the firm’s cost data, Ron, a manager, discovered that one of the plants has a higher averagecost than the other plans and suggests closing this plant. Another manager, Jack, notes that the high-cost plant has high fixed costs but that the marginal cost in this plant is lower than in the other plants.He says that the high-cost plant should not be shut down but should expand its operations. Who isright? 2. Should a firm shut down if its weekly revenue is $1,000, its variable cost is $500, and its fixed cost is$800, of which $600 is avoidable if it shuts down? Explain.
1. Which of the following remains constant as output increases? O a. TFC O b. TVC C. TC O d. All of the above
Suppose that the market price increases to 6, as Table 8.14 shows. What would happen to the profit-maximizing output level?

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