3 Explain the relationship between Average Variable Cost and the price of labor in the short-run...
3 Explain the relationship between Average Variable Cost and the price of labor in the short-run production.
Homework Answers
Solution -
The average variable cost (AVC)
is the cost of each unit of output. In other language, each unit of AVC output is priced.
graphically, the average price of the short run is at the U shape.
When men in first-run AVC come first, their minimum points reach and then grow.
In symbol form,
SRAVVC (Short Run Average Variable Cost) = WL / Q
Where W Stands for wage rate,
L Stands For number of labor used ,
Q is the product number.
The relation is that when the product is zero, the labor price is zero, but the output increases even when the production increases.
In other side, at least AVC will decrease and reach its minimum point.
Increasing production will require more labor. Such type of labor value increases at an average variable price.
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Add Answer to:
3 Explain the relationship between Average Variable Cost and the
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when deciding In the short run, a firm must consider the relationship between price and whether...
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. Define and explain the difference between the long run and the short-run production functions. Why...
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Exhibit 12-2 Short Run Morginal Cost Average $105---- Total $88------ Cost Average Variable $55 - Cost...
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In the short run, average total cost is less than average variable cost. sometimes higher and...
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Question 1 In the short run, as output increases, the difference between average total cost and...
Question 1 In the short run, as output increases, the difference between average total cost and average variable cost decreases. the difference between total cost and average variable cost decreases marginal cost eventually decreases. All of the above are correct. Question 2 The marginal cost curve intersects the at its minimum average variable cost curve average total cost curve average fixed cost curve A and B are both correct. Question 3 Refer to the short-run information provided in Figure 8.5...
For the first drop down "Based on what you know of the relationship between short-run and...
For the first drop down "Based on what you know of the
relationship between short-run and long-run costs, the firm's long
run average cost curve will look most like (LRAC1 /OR/ LRAC2) on
the graph below"
For the last part Short Run / Long Run
Economic Profit Positive / negative OR zero
Action Produce Exit OR Shutdown
Thank you!!
1. Shut down versus exit prices in the short and long run Aa Aa The graph below represents the marginal cost...
The short-run relationship between the number of labor units
that may be used in the production process and the total output
that may be produced per period of time is as shown on the table
below:
The short-run relationship between the number of labor units that may be used in the production process and the total output that may be produced per period of time is as sh on the table below: own # of Lab r Units may be...
when deciding In the short run, a firm must consider the relationship between price and whether to operate or shut down. average variable cost O total cost average fixed cost O unavoidable cost
when deciding In the short run, a firm must consider the relationship between price and whether to operate or shut down. average variable cost O total cost O average fixed cost O unavoidable cost
Exhibit 12-2 Short Run Morginal Cost Average $105---- Total $88------ Cost Average Variable $55 - Cost 460 1675 600 Refer to Exhibit 12-2. Suppose the market price equals $88 and the firm is currently producing 600 units of output. In this situation, the firm: is maximizing profit. should increase production of output in order to maximize profit. should decrease production of output in order to maximize profit. should shut down in order to minimize economic losses.
In the short run, average total cost is less than average variable cost. sometimes higher and sometimes lower than average variable cost. higher than average variable cost. equal to average variable cost. QUESTION 4 1 pc If, in the short run, the level of output is zero, which of the following statement is TRUE? Total variable cost is zero but total cost equals total fixed cost, and both of the latter exceed zero. Total cost and total fixed cost graphs...
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For the first drop down "Based on what you know of the
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Action Produce Exit OR Shutdown
Thank you!!
1. Shut down versus exit prices in the short and long run Aa Aa The graph below represents the marginal cost...
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