Homework Answers
This explains the relationship between marginal and average cost . When marginal cost or the cost just added is smaller than average cost , the average cost is falling . When the marginal cost or cost of last unit added is higher than average costs of unit produced , the average cost rises . When marginal cost added is just equal to average cost . then the average does not change or remains constant .
MC is always to the left of AC and cuts AC from its lowest point .
Similarly when marginal product of labor is higher than average product , the average product curve rises . When marginal product of labor is below average product , average product declines .
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15. Explain: "Whenever a number which is less than the previous average of a total is added to that total, the aver...
How does learning by doing affect average total costs? Short-run average total costs will rise because...
How does learning by doing affect average total costs? Short-run average total costs will rise because employees will continually fail, causing training costs (variable costs) to increase for the firm. Short-run average total costs will rise because firms will hire employees that have failed in previous jobs, causing decreased productivity Short-run average total costs will fall because employees learn which production processes work and become more productive given the available inputs. Short-run average total costs will remain unchanged because any...
In the short run, average total cost is less than average variable cost. sometimes higher and...
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...
Suppose firms in a monopolistically competitive industry currently charge a price less than their average total...
Suppose firms in a monopolistically competitive industry currently charge a price less than their average total cost. What will be the profitability for firms in the short and long term? 1) In the short run, firms in this market will A) make a loss. B) break even. C) make a profit. 2) In the long run, firms in the market will A) break even or exit the market. B) make a loss. C) make a profit. 3) What will happen...
The following graph shows the short-run average total cost curves and the long-run average total cost...
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 .
7. Long-run cost relationships The following graph shows the short-run average total cost curves and the long-run average...
Which of the following is not a valid generalization concerning the relationship between price and costs...
Which of the following is not a valid generalization concerning the relationship between price and costs for a purely competitive seller in the short run? 23 Multiple Choice еВook Price must be at least equal to average total cost. Price times quantity produced must be equal to or greater than total variable cost for some level of output or the firm will close down in the short run. Price may be equal to, greater than, or less than average total...
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...
19. Consider the following Solow-Swan model in which output per capita is given by y-Aks, the...
19. Consider the following Solow-Swan model in which output per capita is given by y-Aks, the total factor productivity parameter is 2, the savings rate is 50%, the depreciation rate is 20% and the population growth rate is 5%. The steady state value of the output per capita, y, for this economy is: 1 a. b. 4 c. 8 d. 16 20. Which of following best describes when purchasing power parity does and does not hold? a. A country with...
Q2 please！ (ii) Does the slope of your long-run total cost curve correspond to your (iii)...
Q2 please！
(ii) Does the slope of your long-run total cost curve correspond to your (iii) Explain why, at any output level, the long-run total cost is always less than prediction in Part (2) or equal to the short-run total cost. Long-run marginal cost curve On Curve Sheet C, draw the long-run marginal cost curve. (7) (8) (i) (ii) Long-run average cost. On the attached Curve Sheet C, draw the long-run average cost curve. Explain why, at any output level,...
The demand curve for a perfectly competitive firm options: is upward sloping. is perfectly horizontal. is...
The demand curve for a perfectly competitive firm options: is upward sloping. is perfectly horizontal. is perfectly vertical. maybe downward or upward sloping, depending upon the type of product offered for sale. In the short run, the best policy for a perfectly competitive firm is to Question 17 options: shut down its operation if the price ever falls below average total cost. produce and sell its product as long as price is greater than average variable cost. shut down its...
Condé Nast shuts down Portfolio Condé Nast Publications launched its monthly business magazine Portfolio less than...
Condé Nast shuts down Portfolio Condé Nast Publications launched its monthly business magazine Portfolio less than two years ago. In late 2008, Condé Nast cut its payroll and advertising budgets by an average of 5 percent. Portfolio was hit with the biggest cuts. Recently, Condé Nast shut down Portfolio. Source: Wall Street Journal, April 28, 2009 Explain the effects of the payroll and advertising budget cuts on Condé Nast's loss in the short run. Why did Condé Nast shut down...
How does learning by doing affect average total costs? Short-run average total costs will rise because employees will continually fail, causing training costs (variable costs) to increase for the firm. Short-run average total costs will rise because firms will hire employees that have failed in previous jobs, causing decreased productivity Short-run average total costs will fall because employees learn which production processes work and become more productive given the available inputs. Short-run average total costs will remain unchanged because any...
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...
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 .
7. Long-run cost relationships The following graph shows the short-run average total cost curves and the long-run average...
Which of the following is not a valid generalization concerning the relationship between price and costs for a purely competitive seller in the short run? 23 Multiple Choice еВook Price must be at least equal to average total cost. Price times quantity produced must be equal to or greater than total variable cost for some level of output or the firm will close down in the short run. Price may be equal to, greater than, or less than average total...
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...
19. Consider the following Solow-Swan model in which output per capita is given by y-Aks, the total factor productivity parameter is 2, the savings rate is 50%, the depreciation rate is 20% and the population growth rate is 5%. The steady state value of the output per capita, y, for this economy is: 1 a. b. 4 c. 8 d. 16 20. Which of following best describes when purchasing power parity does and does not hold? a. A country with...
Q2 please！
(ii) Does the slope of your long-run total cost curve correspond to your (iii) Explain why, at any output level, the long-run total cost is always less than prediction in Part (2) or equal to the short-run total cost. Long-run marginal cost curve On Curve Sheet C, draw the long-run marginal cost curve. (7) (8) (i) (ii) Long-run average cost. On the attached Curve Sheet C, draw the long-run average cost curve. Explain why, at any output level,...
Condé Nast shuts down Portfolio Condé Nast Publications launched its monthly business magazine Portfolio less than two years ago. In late 2008, Condé Nast cut its payroll and advertising budgets by an average of 5 percent. Portfolio was hit with the biggest cuts. Recently, Condé Nast shut down Portfolio. Source: Wall Street Journal, April 28, 2009 Explain the effects of the payroll and advertising budget cuts on Condé Nast's loss in the short run. Why did Condé Nast shut down...
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