9. At an output level of 500, a firm has marginal cost MC = 5 and...
A firm has total cost of TC(y)=y²+1 and marginal cost of MC(y)=2y. At what level of output does the firm's average total cost achieve its minimum?
Question 1. Cost concepts The concepts of "marginal cost" (MC) and "average cost" (AC) are routinely used in economics. (a) Suppose the total cost function is C(q) = 9+0.250, where is the output level of the firm. Derive the marginal cost and the average cost implied by this cost function. Provide a diagram (with q on the horizontal axis) to illustrate the shape of these MC and AC functions. (b) What does returns to scale mean? Does a firm with...
At its current output level, a firm’s marginal revenue exceeds its marginal cost and its price is less than its average cost. Therefore, it should: A. Increase output until MR = 0 B. Increase its price C. Decrease output until MR = MC D. Shutdown Immediately E. Increase output until MR = MC
12. A firm is producing at an output level where AR = MC > AC > MR = 0 a. Is this firm maximizing profits? b. Is this firm maximizing revenue(sales)? c. Is it making more than normal profits? d. Could this firm decrease average costs by increasing production? e. Could this firm increase total revenue by increasing production? 13. Do the same for: AC = AR > MR > MC > 0 14. Also for the following: AR=MR=MC=AC (what...
At a firm's current level of production, marginal revenue is less than marginal cost (MR<MC). A profit- maximizing firm will decrease prices. increase output O decrease output. shut down.
How can marginal cost be expressed mathematically? Marginal cost (MC) can be expressed as MC = " where AC is average cost and is output. TC - FC, where TC is total cost and FC is fixed cost. A where TC is total cost and Q is output 10 where FC is fixed cost and is output MC where TC is total cost and is output For example, if the total cost of producing three units of output is $2,639...
At a firm's current level of production, marginal revenue is greater than marginal cost (MR>MC).A profit-maximizing firm will increase prices. increase output decrease output. O shut down.
Suppose that a competitive firm's marginal cost of producing output q (MC) is given by MC(q) = 3 + 2q. Assume that the market price (P) of the firm's product is $15. What level of output (q) will the firm produce? The firm will produce units of output. (Enter your response rounded to two decimal places.) What is the firm's producer surplus? Producer surplus (PS) is $ . (Enter your response rounded to two decimal places.) Suppose that the average...
The graph shows a firm's average total cost (ATC) and marginal cost (MC) curves. At what output level does the firm have economies of scale? 12 11 10 MC ATC 9 8 Price $/Q 4 3 N 14 16 15 0 12 13 10 9 8 7 6 4 5 3 2 0 Quantity Quantit OQ > 4 OQ < 4 OQ> 8 OQ < 8
Suppose that a competitive firm's marginal cost of producing output q (MC) is given by MC(q) = 6 +29. Assume that the market price (P) of the firm's product is $18. What level of output (q) will the firm produce? The firm will produce 6.00 units of output. (Enter your response rounded to two decimal places.) What is the firm's producer surplus? Producer surplus (PS) is $ 36.00. (Enter your response rounded to two decimal places.) Suppose that the average...