caught for Juan‚ a commercial fisherman. Labor (hours) 1 2 3 4 5 6 Quantity of Fish (pounds) 10 18 24 28 30 32 Marginal Product (pounds) a. Complete the Marginal Product column in the Table. b. Characterize the production function‚ i.e. does the production function display increasing marginal returns‚ diminishing marginal returns‚ etc. c. Using the data above‚ graph Juan’s marginal product curve. Be sure to label the horizontal and vertical axes. Is your graph consistent with your answer to part
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neither profits nor losses. Thus‚ the firm is better off producing nothing. 2) Jacob’s total variable cost function has been calculated to be TVC = 100Q + 30Q² - Q³‚ where Q is the number of units of output. a. When marginal cost is a minimum‚ what is the output level? Marginal cost = dTVC/dQ = 100 + 60Q -3Q² ‚ dMC/dQ= 60 - 6Q = 0‚ 6Q = 60‚ Q = 10 Therefore‚ the output level is 10 units. b. When average variable cost is a minimum‚ what is the output level? Average variable cost = TVC/Q = 100
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(a) A list indicating which categories cost you included in your determination of marginal cost. Briefly explain why you included these and excluded the other categories. | - “Marginal Cost” is aggregation of variable costs whose amount varies pertaining to production quantity. The lists of marginal cost are as follows. ◎ The lists of marginal cost Item | Description | TotalElectricity Cost | in the case of new plant of Alusaf‚ it amount of 16% of per ton aluminum price for every ton of
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[3 points each] Note: Use diagrams and/or equations to explain your answer. I. Explain the difference between diminishing total returns to labour and diminishing marginal returns to labour. Diminishing returns to labour means that an increase in the number of labour units will decrease the amount of output. Diminishing marginal returns means that additional units of labour increase output at a decreasing rate. II. Suppose the production function for T-shirts can be represented as q =
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Public Expenditure - Regulate Market Failures Market Failure - Is an economic situation where resources are misallocated - May be caused by two possible factors: ○ Market Power ○ Non-existence of Markets Why is Market Power a source of Failure? - Marginal Cost Pricing is not practised (P > MC) - There is a tendency for firms to behave according to profit-maximization motive because they have market power. - This type of market failure is borne from Imperfect Competition Non-Existence of Markets -
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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‚ in short‚ necessary for the production and distribution of goods and services. A firm is the business organization that owns one or more
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market price. The rm can sell all that it wants to at this price. 2. A monopoly faces the market demand curve because it is the only seller in the market. If a monopoly wants to sell more output‚ it must lower the price of its product. A monopoly’s marginal revenue will always be less than the price of the good (other than at the rst unit sold). 1. If the monopolist sells one more unit‚ his total revenue (P Q) will rise because Q is getting larger. This is called the output e ect. 2. If the monopolist
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Week I Quiz Results/Answers ECO561 1. Revenue increases when * producer surplus increases 2. An increase in the price of an inelastic good * increases revenues 3. Price elasticity of Demand increases when * people become less price sensitive over time 4. The purpose of a market in a market system is to * bring buyers and sellers into contact 5. By specializing in the production of one good‚ a company is able to benefit from economies of scale which increases its revenue. Which
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compulsory 3. Each question in Part A carries 1 mark & each Question in Part B carries 10 marks 4. All Questions to be answered in the Question Booklet 1. In the diagram above‚ d and MR represent‚ respectively‚ the demand curve and the marginal revenue curve of an oligopolist. The kink in the demand curve means that the firm will a. match any price increase above P1‚ but will not match any price decrease below P1. b. not match any price increase above P1‚ but will match any price decrease
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With this‚ he offers a philosophical approach to a new world where‚ instead of giving to charity‚ everyone living in these affluent nations ought to make it their duty to give anything of excess to those suffering across the globe and live at the marginal utility‚ which he would prefer. He also offers a less drastic option of moderate assistance wherein those who are able to assist ought to‚ as long as it does not create a similar moral dilemma. Critics argue that rewriting the moral scheme from
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