Question

Check my w A new production technology for making vitamins is invented by a college professor who decides not to patent it. Thus, it is available for anybody to copy and put into use. The TC per bottle for production up to 100,000 bottles per day is given in the following table. Instructions: In part around your answers to 2 decimal places. In parts cand d, enter your answers as whole numbers. a. What is ATC for each level of output listed in the table? ATC eBook Output 25,000.00 50,000.00 75,000.00 100,000.00 $ $ $ $ TC 100,000.00 120,000.00 125,000.00 130,000.00 Print eferences b. Suppose that for each 25,000-bottle-per-day increase in production above 100,000 bottles per day, TC increases by $5,000 (so that, for instance, 125,000 bottles per day would generate total costs of $135,000 and 150,000 bottles per day would generate total costs of $140,000). Is this a decreasing-cost industry? (Click to select) c. Suppose that the price of a bottle of vitamins is $2.33 and that at that price the total quantity demanded by consumers is 75,000,000 bottles. How many firms will there be in this industry? firm(s) d. Suppose that, instead, the market quantity demanded at a price of $2.33 is only 75,000. How many firms do you expect there to be in this industry? firm(s)

Answer 1

output To ATC 4 2.4 25000 5000 gooo 100 ooo 100000 120ooo nooo oool 1.667 1.30 20 130ooo Yes because as quantity increases, average cost decreases leading it to be a decreasing cast Industry. Punci = 2.333 , do=75000,000 Ac dureasy as mon is produed 4 mero.2 Thus singh fein can supply one entire market. no offraims foim but due to fruce entry Saare only Al hesto be perio=2.33 , no of freem - t. & each form produn 120,000 No. of frein = 75000000 = 625 form 120 ooo @ only I firim