HW 2 Managerial Economics‚ ECON 601 1. Consider the following short-run production function (where L = variable input‚ Q = output): Q = 6L2 – 0.4L3 |a. |Determine the marginal product function (MPL). (5 points) | |b. |Determine the average product function (APL). (5 points) | |c. |Find the value of L that maximizes Q. (5 points)
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chapter Six businesses and Their Costs ANSWERS TO END-OF-CHAPTER QUESTIONS 6-1 Distinguish clearly between a plant‚ a firm‚ and an industry. Contrast a vertically integrated firm‚ a horizontally integrated firm‚ and a conglomerate. Cite an example of a horizontally integrated firm from which you have recently made a purchase. A plant is an operating unit where production takes place. This production can be manufacturing‚ farming‚ mining‚ retailing‚ wholesaling‚ warehousing—anything
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Knowledge Check Week 2Results Concepts Marginal Revenue‚ Marginal Cost‚ and Production Marginal Productivity Mastery 100% Questions Score: 12/14 1 2 3 7 100% 4 5 6 9 11 Average Total Cost 0% 8 10 Fixed and Variable Costs 100% 12 13 14 Concept: Marginal Revenue‚ Marginal Cost‚ and Production Concepts Marginal Revenue‚ Marginal Cost‚ and Production Mastery 100% Questions 1 2 3 7 1.Purely competitive firms increase total
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FORMATIVE WORK FOR ECONOMICS In this article‚ we will consider how a price-taking profit maximising business in perfect competition changes according to the change of the fixed factor cost-capital. A i) The short-run marginal cost (MC) curve of each business remains the same‚ but the short run AC curve of each business shifts downwards. Perfect competition is an industrial structure that includes many firms selling an identical product to many buyers and has no restrictions for new firms to entry
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the demand and marginal cost curves which is P = 12 - 0.002Q and MC = 3 + 0.001Q. When the demand curve is P = a- bQ‚ the marginal revenue curve will be MR = a- 2bQ ‚ therefore‚ MR = 12 - 0.004Q.(Refer to figure1) Figure 1 To maximize the profits‚ the company should produce at the output level where marginal revenue is equal to marginal cost. If the marginal revenue is higher than marginal cost‚ the firm can increase profit by producing more. If the marginal cost is higher
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that Steve receives from consuming oranges at 50 cents apiece. What is the marginal utility of increasing consumption from 2 to 3 oranges? [pic] A. 3 B. 6 C. 5 D. 12 3. Suppose that if you buy one Big Mac that gives you marginal utility of 500 and a second Big Mac that gives you marginal utility of 200‚ total utility of buying (and eating) two Big Macs is: A. 200. B. 300. C. 500. D. 700. 4. When marginal utility is zero‚ total utility is: A. increasing. B. decreasing. C. zero
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we‚ individuals‚ simply want to maximize our utility. By applying more market theory‚ the answer to my posed question is simply that the reason these shorts are set at the price they are‚ is because the consumers’ marginal willingness to pay for them equals or exceeds their value (marginal
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cost (TC) Profit Marginal revenue (MR) Marginal cost (MC) 1 400 400 190 210 400 190 2 380 760 380 380 360 190 3 360 1080 570 510 320 190 4 340 1360 760 600 280 190 5 320 1600 950 650 240 190 6 300 1800 1140 660 200 190 7 280 1960 1330 630 160 190 8 260 2080 1520 560 120 190 9 240 2160 1710 450 80 190 10 220 2200 1900 300 40 190 Profit will be maximized when marginal revenue is equal to marginal cost. The given information
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supply of land to be various amounts either greater or smaller‚ and then discover what the competitively determinedprice would be‚ we can trace out the demand schedule for American land. Assume that this demand schedule is DD and that from this a marginal revenue schedule‚ MR‚ has been derived. Both schedules are shown in Figure I. Let the total amount of land in existence be OQ. Then‚ if the price were competitively determined‚the price would be OB (see Figure I). We now have to determine the price
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10 units of output f. The average total cost of producing 10 units of output g. The marginal cost when Q = 10 Question 6. On page 193 A firm’s fixed costs for producing 0 units of output and its average total cost of producing different output levels are summarized in the tale below. Complete the table to find the fixed cost‚ variable cost‚ total cost‚ average fixed cost‚ average variable cost‚ and marginal cost at all levels of output. Q FC VC TC AFC AVC ATC MC 0 $15‚000 ----- 100
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