A firm has the following long-run total cost function: LTC = 3500Q - 450Q2 + 15Q3...
A firm has the following long-run total cost function:
LTC = 3500Q - 450Q2 + 15Q3
a. Write the equation for the long-run average cost.
b. Determine the minimum value of LAC.
c. If the firm is a price taker, determine the minimum long-run price it must receive so that it will not exit the industry.
d. Over what range of output will the firm have economies of scale?
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A firm has the following long-run total cost function:
LTC = 3500Q - 450Q2 +
15Q3...
7. A bicycle company has the following long run total cost function: LTC(Q) = 40,000Q –...
7. A bicycle company has the following long run total cost function: LTC(Q) = 40,000Q – 400Q2 + 203 where Q is the number of bikes produced. a. Compute the company's LMC and LAC as a function of Q b. Assume that that there is perfect competition. How many bikes would the bicycle company produce in the long run? c. Over what range of output does the company experience economies of scale? Over what range of output does it experience...
(Click to select) economies of scale a. Long-run average total cost falls as the firm realize: rises when the firm...
(Click to select) economies of scale a. Long-run average total cost falls as the firm realize: rises when the firm experiences [ (Click to select) diseconomies of scale diminishing marginal returns increasing marginal returns b. The minimum efficient scale is the level of output produced by the smallest firm in the industry. smallest level of output at which a firm can produce. only level of output where long-run average total costs are minimized. smallest level of output needed to attain...
Costs — End of Chapter Problem Peter's Pipers produces plumbing pipe. The long-run total cost of...
Costs — End of Chapter Problem Peter's Pipers produces plumbing pipe. The long-run total cost of Peter's pipes is LTC = 20,000Q – 200Q2 +Q3 where Q is measured as thousands of feet of piping. The long-run marginal cost of Peter's pipes is LMC = 20,000 – 400Q +3Q? a. Divide total cost by Q to obtain Peter's long-run average cost of producing pipe. Average cost = $ b. Exploit the relationship between LMC and LAC to find the quantity...
Economies of scale refers to when: In the long run when average total cost does not...
Economies of scale refers to when:
In the long run when average total cost does not depend on the
quantity of output, this is called:
Commodities:
We assume that in the long run in a perfectly competitive
market:
Multiple Choice an increase in the quantity of output increases average total cost in the long run. None are correct. average total cost does not depend on the quantity of output in the long run. an increase in the quantity of output...
If the long-run average total cost curve for a firm is horizontal in a relevant range...
If the long-run average total cost curve for a firm is horizontal in a relevant range of production, then it indicates that there rev: 06_26_2018 Multiple Choice isn’t a minimum efficiency scale. are diseconomies of scale. are economies of scale. are constant returns to scale.
QUESTION 30 A downward-sloping portion of a long-run average total cost curve is the result of:...
QUESTION 30 A downward-sloping portion of a long-run average total cost curve is the result of: economies of scale. diseconomies of scale. diminishing returns. the existence of fixed resources. 2.5 points QUESTION 31 In the long run, firms in many industries often experience a falling average total cost curve as a result of: gains through trade. increasing marginal returns. economies of scale. lower fixed costs. 2.5 points QUESTION 32 A large aircraft manufacturer, like Boeing, may have a...
Question 3 Long-run average total cost (LAC) O a represents the lowest average cost of producing a given level of...
Question 3 Long-run average total cost (LAC) O a represents the lowest average cost of producing a given level of output. b. is always equal to or greater than short-run average total cost. c. can be measured in the short-run. If a firm is producing the level of output at which long-run average cost equals long-run marginal cost, then a long-run marginal cost is at its minimum point b. long run average cost is at its minimum point. c long...
The firm's long-run total cost is given by LTC = 5,000Q - 100Q^2 + Q^3 and its long-run marginal cost is given by LMC =...
The firm's long-run total cost is given by LTC = 5,000Q - 100Q^2 + Q^3 and its long-run marginal cost is given by LMC = 5,000 - 200Q + 3Q^2. At what output level does the firm experience diseconomies of scale? I don't understand how it goes from this " 5000 - 100Q + Q2 " to this equation "-100 + 2Q = 0"
6. Long-run cost relationships The following graph shows the short-run average total cost curves and the...
6. Long-run cost relationships The following graph shows the short-run average total cost curves and the long-run average cost curve for a publishing firm. The five marked quantities indicate points of tangency between each short-run average total cost curve (ATC) and the long-run average cost curve (LRAC); for example, Q1 marks the point of tangency between ATC, and LRAC. The orange point on ATC indicates the firm's current output level in the short run (Qs). ATC LRAC ATC ATC, COST...
Long-run cost relationships The following graph shows the short-run average total cost curves and the long-run average total cost curve for a publishing firm.
7. Long-run cost relationships The following graph shows the short-run average total cost curves and the long-run average total cost curve for a publishing firm. The five marked quantities indicate points of tangency between each short-run average total cost curve (SRATC) and the long-run average total cost curve (LRATC); for example, Q1 marks the point of tangency between SRATC1 and LRATC The orange point on SRATCs indicates the firm's current output level in the short run (Q5). SRATC SRATC SRATC4...
7. A bicycle company has the following long run total cost function: LTC(Q) = 40,000Q – 400Q2 + 203 where Q is the number of bikes produced. a. Compute the company's LMC and LAC as a function of Q b. Assume that that there is perfect competition. How many bikes would the bicycle company produce in the long run? c. Over what range of output does the company experience economies of scale? Over what range of output does it experience...
(Click to select) economies of scale a. Long-run average total cost falls as the firm realize: rises when the firm experiences [ (Click to select) diseconomies of scale diminishing marginal returns increasing marginal returns b. The minimum efficient scale is the level of output produced by the smallest firm in the industry. smallest level of output at which a firm can produce. only level of output where long-run average total costs are minimized. smallest level of output needed to attain...
Costs — End of Chapter Problem Peter's Pipers produces plumbing pipe. The long-run total cost of Peter's pipes is LTC = 20,000Q – 200Q2 +Q3 where Q is measured as thousands of feet of piping. The long-run marginal cost of Peter's pipes is LMC = 20,000 – 400Q +3Q? a. Divide total cost by Q to obtain Peter's long-run average cost of producing pipe. Average cost = $ b. Exploit the relationship between LMC and LAC to find the quantity...
Economies of scale refers to when:
In the long run when average total cost does not depend on the
quantity of output, this is called:
Commodities:
We assume that in the long run in a perfectly competitive
market:
Multiple Choice an increase in the quantity of output increases average total cost in the long run. None are correct. average total cost does not depend on the quantity of output in the long run. an increase in the quantity of output...
Question 3 Long-run average total cost (LAC) O a represents the lowest average cost of producing a given level of output. b. is always equal to or greater than short-run average total cost. c. can be measured in the short-run. If a firm is producing the level of output at which long-run average cost equals long-run marginal cost, then a long-run marginal cost is at its minimum point b. long run average cost is at its minimum point. c long...
6. Long-run cost relationships The following graph shows the short-run average total cost curves and the long-run average cost curve for a publishing firm. The five marked quantities indicate points of tangency between each short-run average total cost curve (ATC) and the long-run average cost curve (LRAC); for example, Q1 marks the point of tangency between ATC, and LRAC. The orange point on ATC indicates the firm's current output level in the short run (Qs). ATC LRAC ATC ATC, COST...
7. Long-run cost relationships The following graph shows the short-run average total cost curves and the long-run average total cost curve for a publishing firm. The five marked quantities indicate points of tangency between each short-run average total cost curve (SRATC) and the long-run average total cost curve (LRATC); for example, Q1 marks the point of tangency between SRATC1 and LRATC The orange point on SRATCs indicates the firm's current output level in the short run (Q5). SRATC SRATC SRATC4...
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