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Q1. Compute the profit-maximizing level of output and price if the company sells all of its tickets at one price. Q2. Compute the profit-maximizing level of output and price if it charges different pr
Suppose market price is $30. How much will the firm produce in the short run? How much are total profits?
Output is produced according to Q = 4L + 6K, where L is the quantity of labor input and K is the quantity of capital input. If the price of K is $12 and the price of L is $6, then the cost minimizin
Economists at General Industries have been examining operating costs at one of its parts manufacturing plants in an effort to determine whether the plant is being operated efficiently. From weekly c
Analyze the major short run and long cost functions for the low-calorie, frozen microwaveable food company given the cost functions below. Suggest substantive ways in which the low-calorie food comp
You are the manager of a bakery that produces and packages gourmet bran muffins, and you currently sell bran muffins in packages of three. You want to examine price and output strategy.
Suppose the market price of sugar is 22 cents per pound. If a sugar farmer produces 100,000 pounds, the marginal cost of sugar is 30 cents per pound. Is the farmer maximizing profit? If not, should
Q1. Determine the firm's optimal output and price Q2. The night supervisor believes that keeping QopyQat open for two more hours in the evening would substantially increase volume.
Under what circumstances would it be economically efficient for this clinic to use more R.N.s and fewer M.D.s (given (MPmd>MPrn)? Explain?
If the firm has fixed costs of $900, calculate the short run average fixed costs, average total costs, total cost, and marginal cost.!
Use the given data of a firm's total cost schedules to calculate its average variable cost, average fixed cost, average total cost, and marginal cost schedules.
Explain any two causes of economies of scale or diseconomies of scale. How is the U shape of the long run ATC different from the U shape of the short run ATC?
If the price of each unit of output is $10 and each worker hired must be paid $40 per day, how many workers should Ms. Smith hire?
Discuss two factors that would increase demand for labor. (Hint: Recall that the demand for factors of production or resources is called a derived demand)
When a firm engages in cost-plus pricing: Select one: a. It is ignoring principles of profit maximization as fixed cost is included in the determination of the selling price
Problem: 1. A firm under monopolistic competition faces the demand curve: P = 500 - 12.5Q. The firm's marginal cost is MC = 200 + 5Q. a. Find the firm's profit-maximizing output and price.
Problem: Is it true that in the long run insurance (Obamacare) companies can make profits at the expense of their customers?
The U.S. government subsidizes flood insurance because those who want to buy it live in the flood plain and cannot get it at reasonable rates. What inefficiency does this create?
If long-term contract prevent the firm from changing the amount of trucking services it rents, should the firm increase, decrease, or leave constant the amount of labor employed? The goal is to maxi
Q1. What is total fixed cost? Q2. What happens to profit if output increases slightly? i. Increase ii. Decrease iv. Impossible to tell
What will be the output level for this firm if management sets price at $26 per unit, and rivals match the price decrease? Is this price feasible under current cost conditions?
Q1. Determine the price and quantity that would result under competitive conditions. Q2. The Chilean Fruit Growers are trying to organize a cartel among growers in their region. Assuming that all gr
Determine the price and output combination that the dominant firm would need to maximize profit for itself.
If the firm is engaging in price discrimination, what prices should be charged on each market and how many units should be sold on each market?
Assume that there is no external market for the output of the production division. How many units should be produced and what transfer price should be paid to the production division by the marketin