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The four of you put in a total of 150 hours a week. If your accounting profit came to $1,000 a week, estimate your weekly economic profit.
At an output of 9, MC $20 and AVC $25. At an output of 10, MC $32 and AVC $26. What is the lowest price the firm will accept in the short run?
How would you distinguish between the short run and the long run? What are economies of scale? Please give an example. What are diseconomies of scale?
Kirsten pays $2 for a bottle of water. Explain how it's possible for her to be enjoying a consumer surplus.
How much is your total utility from the two massages? How much is your consumer surplus if you get two half-hour massages?
How much is your marginal utility from the third bottle? How much is the total utility you will get from the three bottles? How much is your consumer surplus?
Why would Tommy Watson eventually reach the point of negative marginal utility at an all-you-can-eat restaurant? Explain the water-diamond paradox.
If demand is perfectly elastic, how much of the burden of a one-dollar tax increase would be borne by the seller, and how much would be borne by the buyer?
Explain the law of diminishing marginal utility, and give an example to illustrate it. How do we measure utility? Are interpersonal comparisons valid?
What if you could walk into a music store and get as many CDs as you wanted. How many CDs would you listen to? Explain your answer in terms of marginal utility.
What business will you go into, and what will be your fixed and variable costs? Show how your business can take advantage of economies of scale.
Why is a business firm never in the long run? On what basis does a firm decide whether or not to shut down?
What are the fixed and variable costs for a car wash? Is it likely to experience economies of scale?
If tuition is $600 for the course, how many students would you need to sign up for the course to run?
How much are the fixed and variable costs of renting a compact car for a week at Boston's Logan Airport? Go to budget websiteor avis website.
If firm's total revenue is $5 billion, its fixed costs are $3 billion and its variable costs are $1.5 billion, what does it do in the short run and in long run?
What would be the average total cost of sending out 10 e-mails? What would be the average total cost of sending out 100 e-mails?
A firm has a fixed cost of $1,000. At one unit of output variable cost is $1,200. Find total cost at zero units of output and marginal cost at unit of output.
After checking the prices of the coins, would you say the market is close to being perfectly competitive? Why or why not?
How do you find the most efficient output, and how do you find the most profitable output?
If your monthly sales were $4,000, what would you do (a) in the short run and (b) in the long run?
Is the analysis for maximizing profits the same as that for minimizing losses? Explain why it is or why it isn't.
Suppose that price were higher than AVC but lower than ATC. What should the firm do in the short run and the long run? Explain your answer.
If the perfect competitor is losing money in the short run, what happens in the market to drive up price?
Can you think of any dot-coms that may be considered perfect competitors? Explain why a perfectly competitive firm will not advertise.