Question
In: Economics
The table below shows three possible combinations of fixed cost and average variable cost. Choice Fixed...
The table below shows three possible combinations of fixed
cost and average variable cost.
Choice Fixed Cost Average Variable Cost
1 $8,000 $1.00
2 12,000 0.75
3 24,000 0.25
a. For each of the three choices, calculate the average total
cost of producing 12,000, 22,000 and 30,000 units. For each of
these quantities, which choice results in the lowest average total
cost?
Solutions
Expert Solution
1.
Q=12,000
Fixed cost=8000
Average variable cost=1
Total variable cost=AVC*Q
=12000*1
=12000
TC=TVC+TFC
=12000+8000
=20000
Average total cost=TC/Q
=20000/12000
=1.66
2.
Q=22000
TFC=12,000
AVC=0.75
TVC=0.75*22000
=16,500
TC=TFC+TVC
=12,000+16,500
=28,500
ATC=TC/Q
=28,500/22,000
=1.295
3.
Q=30,000
TFC=24,000
AVC=0.25
TVC=AVC*Q
=0.25*30000
=7500
TC=24000+7500
=31,500
ATC=31,500/30000
=1.05
Third choice leads to lowest average total cost.
It means quantity 30,000 leads to lowest average total cost.
Rahul Sunny answered 2 years agoRelated Solutions
The table below shows the possible production combinations of beer and sausage for Heapland Possible Production...
The table below shows the possible production combinations of
beer and sausage for Heapland
Possible Production Combinations
Bourbon
(barrels)
Computers
A
70
0
B
60
20
C
50
36
D
40
48
E
30
56
F
20
60
G
10
63
H
0
65
a(1). Suppose current productionis at point D. What is
the opportunity cost of producing 10 more barrels of
bourbon?Provide a clear explanation in the box below.
d(2). Suppose that the citizens of Heapland have yet to...
The table below shows part of the cost structure (total fixed cost, total variable cost, and...
The table below shows part of the cost structure (total fixed
cost, total variable cost, and total cost) for a typical producer
of olive oil -- a perfectly competitive industry.
Copy the table into Excel and use it to calculate average total
cost and marginal cost for all quantities from 1 to 10. Use Excel
(following the hints in QSet 2, #9) to produce a diagram of the
firm’s average total cost and marginal cost curves.
If the price of...
quantity of broomsticks fixed cost variable cost total cost average fixed cost average variable cost average...
quantity of broomsticks
fixed cost
variable cost
total cost
average fixed cost
average variable cost
average total cost
marginal cost
marginal product
0
10
$13
$38
22
$28
32
$70
41
$64
50
$110
59
$108
65
$133
70
$185
how do I fill in the blanks?
as well as graph the three average cost curves and the marginal
cost curve.
Using the information in data set one, which I have included in the table below, recalculate total cost, fixed cost, variable cost, marginal cost, average total cost, average variable cost and average fixed costs if the price of the variable input (which
Problem TwoUsing the information in data set one, which I have included in
the table below, recalculate total cost, fixed cost, variable cost,
marginal cost, average total cost, average variable cost and
average fixed costs if the price of the variable input (which is
labor in this example) is not $50 but $55. I have created Table 2
for you to put your answers in. Assume that fixed costs remain at
$220. When the price of a variable input changes
which...
The table below shows the average cost of a firm depending on the level of production....
The table below shows the average cost of a firm depending on
the level of production.
Q
0
1
2
3
4
5
6
AC
--
32
24
20
24
25
26
Assuming that the company is operating in the long run what are
fixed costs?
2.) Fill in the following table: Show work if possible Output Total Cost Fixed Cost Variable...
2.) Fill in the following table: Show work if possible
Output
Total Cost
Fixed Cost
Variable Cost
ATC
AFC
AVC
MC
0
100
1
122
2
142
3
154
4
176
5
201
6
235
7
270
8
326
9
398
10
490
b.) Now suppose this firm is in a perfectly competitive
industry. The market price of the output is $25. How many units of
output will this firm choose to produce in the short run? What is
the...
The table shows the quantity produced and the total, average, variable, cost, and marginal costs for a firm. Complete the table.
Unit 9— Cost, Revenue, and ProfitThe table shows the quantity produced and the total, average,
variable, cost, and marginal costs for a firm. Complete the
table.QuantityTotal CostVariable CostFixed CostAverage Total CostAverage Variable CostAverage Fixed CostMarginal Cost00N/AN/AN/AN/A110050502953180130354502052251751025626121174983853359450106855185Graph the total cost, variable cost, and fixed cost curves.Assume the price is $50, draw the total revenue curve and
identify the profit maximizing output level and the maximum
profitGraph the average total cost, average variable, average fixed,
and marginal cost curvesAssume the price is...
Quantity Total Cost Total Fixed Cost Total Variable Cost Average Fixed Cost Average Total Cost Average...
Quantity
Total Cost
Total Fixed Cost
Total Variable Cost
Average Fixed Cost
Average Total Cost
Average Variable Cost
Marginal Cost
0
30
1
75
2
150
3
255
4
380
5
525
6
680
7
840
8
1010
9
1200
Given the quantity and total cost, calculate for total fixed
cost, total variable cost, average fixed cost, average total cost,
average variable cost, and marginal cost.
Excel formulas would be nice but not required.
The table below shows the weekly marginal cost (MC) and average total cost (ATC) for Smitten,...
The table below shows
the weekly marginal cost (MC) and average total cost (ATC) for
Smitten, a perfectly competitive firm that produces children’s
mittens in a competitive market.
Smitten's
Production Costs
Quantity (pairs of mittens)
Marginal Cost (dollars)
Average Total Cost (dollars)
20
$1.60
$1.25
25
2.00
1.40
30
2.45
1.58
35
3.55
1.86
40
4.00
2.13
45
5.50
2.50
50
6.00
2.85
55
8.50
3.36
Instructions: In part a, enter your answer as a
whole number. In parts b–d,...
8. The table below shows the weekly marginal cost (MC) and average total cost (ATC) for...
8. The table below shows the weekly marginal cost (MC) and
average total cost (ATC) for Buddies, a perfectly competitive firm
that produces novelty ear buds in a competitive market. The market
price of ear buds is $6.00 per pair.
Quantity of Ear buds
MC ($)
ATC ($)
5
-
9
10
2
5.5
15
2.44
4.48
20
3.56
4.25
25
4.5
4.3
30
5.02
4.42
35
5.96
4.64
40
8.56
5.13
Instructions: In part a, enter your answer as...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- You should consider(NIKE) whether there are any global factors related to the marketing environment in which...
- 10. What is the relationship betwee BYOD (bring your own device) and shadow IT. 11. What...
- Suppose the company president asks you to determine the target capital structure for the firm and...
- Add a sphere into Unity. write ONE C# script in Unity that does the following: Set...
- Cusic Music Company is considering the sale of a new sound board used in recording studios....
- Mom’s Cookies, Inc., is considering the purchase of new cookie oven. The original cost of the...
- Please consider FIRST 6 Character from your name and LAST 2 digits of your students ID....
ADVERTISEMENT