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You estimate that the average variable cost (AVC) will be $100 for the mower and $1,000 for the tractor. The total fixed cost (TFC) will be $50,000 for the mower and $100,000 for the tractor. What is the total cost of the mowers for each order?
What is the total cost of the tractors for each order?
2. What is the average total cost of the mowers?
What is the average total cost of the tractors?
3. You consult with your colleagues, and you all agree that effective pricing can assist you in avoiding the serious financial problems that may occur if prices are too high or too low. If the price is high, you may price yourselves out of the market. If the price is low, you may be underpaid for your work. Consequently, you decide to employ a 30 percent markup. What is the new price of the mower?
What is the new price of the tractor?
4. What are the profits for the mower under this scenario?
What are the profits for the tractor?
5. What are the total revenues for the mowers for each order?
What are the total revenues for the tractors for each order?
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You estimate that the average variable cost (AVC) will be $100 for the mower and $1,000...
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a) What is the market price? p = 8 b) Derive the average variable cost, average total cost, and marginal cost function. avc = 1 + q atc = 4/q + 1 + q mc = 1 + 2q c) In the short run, how much does each firm produce? qs = 6 d) In the short run, how much economic profit or loss will be obtained? ep = 2 e) Based on the results in...
For a constant cost industry in which all firms the same cost functions, their long-run average cost is minimized at $10 per unit output and 20 units (i.e. q = 20). Market demand is given by QD=DP=1,500-50P. Find the long-run market supply function Find the long-run equilibrium price (P*), market quantity (Q*), firm output (q*), number of firms (n), and each firm’s profit. The short-run total cost function associated with each firm’s long-run costs is SCq=0.5q2-10q+200. Calculate the short-run average...
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