Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Chapter 9, Problem 2DQ
To determine
Accounting profit, economic profit and normal profit in resource allocation.
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4. Various measures of cost
Suppose the imaginary company of Roobek is a small, Jackson-based American apparel manufacturer specializing in athleisure. The following table
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Fill in the remaining cells of the following table.
Quantity Total Cost Marginal Cost
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Linda sells 100 bottles of homemade ketchup for $10 each. The cost of the ingredients, the bottles, and the labels was $700. In addition, it took her 20 hours to make the ketchup and to do so she took time off from a job that paid her $20 per hour. Linda’s accounting profit is while her economic profit is. LO9.1 a. $700; $400 b. $300; $100 c. $300; negative $100 d. $1,000; negative $1,100
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Variable
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$30
1
$10
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$25
$30
$45
$30
$70
$30
$100
$30
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$135
$30
O $45.00
O S30.00
O S25.00
2)
3.
4)
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Chapter 9 Solutions
Microeconomics
Ch. 9.2 - Prob. 1QQCh. 9.2 - Prob. 2QQCh. 9.2 - Prob. 3QQCh. 9.2 - Prob. 4QQCh. 9.5 - Prob. 1QQCh. 9.5 - Prob. 2QQCh. 9.5 - Prob. 3QQCh. 9.5 - Prob. 4QQCh. 9.8 - Prob. 1QQCh. 9.8 - Prob. 2QQ
Ch. 9.8 - Prob. 3QQCh. 9.8 - Prob. 4QQCh. 9 - Prob. 1DQCh. 9 - Prob. 2DQCh. 9 - Prob. 3DQCh. 9 - Prob. 4DQCh. 9 - Prob. 5DQCh. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Prob. 1RQCh. 9 - Which of the following are short-run and which are...Ch. 9 - Prob. 3RQCh. 9 - Indicate how each of the following would shift the...Ch. 9 - Prob. 5RQCh. 9 - Prob. 6RQCh. 9 - Prob. 1PCh. 9 - Prob. 2PCh. 9 - Prob. 3PCh. 9 - Prob. 4P
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- The following figure shows the revenue and cost curves for a firm X. RM 10 a. b. C. 7 6 LO 5 4 3.5 0 20 25 30 MC 40 AVC AC AR=MR Units If a firm X achieves productivity efficiency, what will be the total revenuel generated At what price will a firm stop operating? Please explain. If the market price is RM4.00, what is the total profit or total loss.arrow_forwardThe table below shows cost data for producing different amounts of cough syrup. Use the given information to find the missing cost data. Quantity 0 1 2 3 4 LO 5 Total Cost in $ 120 150 206 556 -> Average Fixed Cost in $ Average Variable Cost in $ 60 30 24 9. 30 22.5 28.6666666666667 47.25 -> Marginal Cost in $ 30 15 103 247 ←arrow_forwardRefer to the table below. Note that the first column shows variable costs. Quantity Cost Fixed Total Average Average Variable (in dollars) Costs Costs Total Costs Costs (in dollars per 0 1 2 3 4 LO 5 6 0 15 35 60 90 125 160 (in (in (in dollars unit) dollars) dollars) per unit) 40 40 40 40 55 75 37.5 40 100 33.3 40 130 32.5 40 165 33 40 200 33.3 : 15 17.5 20 22.5 25 26.6 Marginal Costs (in dollars per unit) : 15 20 25 30 35 a If the firm produces 5 units that it sells at a price of $30.00 each, what will its profits or losses equal? losses equal $15 profts equal $15 profts equal $25 losses equal $25arrow_forward
- If You are the owner and only employee of a company that writes computer software that is used by gamblers to collect sports data. Last year you earned a total revenue of $90,000. Your costs for equipment, rent, and supplies were $60,000. To start this business you invested an amount of your own capital that could pay you a return of $40,000 a year. then your economic profit is Select one: a. 10,000 O b.-10,000 O c. -40,000 O d. 20,000 O e. 40,000arrow_forwardConsider table 3.1. What is the dollar amount of average variable cost per unit at the production level of 600 units? TC=3205 Production (units) 0 100 Select one: O a. 4.04 O b. 4.34 Oc 4.74 O d. 5.04 200 300 400 500 600 700 Rent $300 $300 $300 $300 Wages $200 $410 $650 $900 $1,200 $300 $300 $1,520 $300 $1,905 $300 $2,300 Supplies Tools $0 $100 50 $100 $150 $200 $250 $300 $350 $200 $300 $400 $500 $600 $700 $800 Total Cost $600 $960 $1,350 $1,750 $2,200 $2,670 $3,205 $3,750 3205 700 300 2,205 TVC 1 - 2205/600= 3.675 Aarrow_forwardYou are the owner and only employee of a company that sets odds for sporting events. Last year you earned a total revenue of $100,000. Your costs for rent and supplies were $50,000. To start this business you invested an amount of your own capital that could pay you a return of $20,000 a year. Your economic profit last year was O $50,000 O $60,000 O $10,000 O $30,000arrow_forward
- Suppose that a business incurred implicit costs of $250,000 and explicit costs of $500,000 in a specific year. If the firm sold 10,000 units of its output at $80 per unit, it's economic profit is O 150,000 O 100,000 300,000 O 50,000arrow_forwardConsider the following production schedule: Output per hour Total Cost 0 $ 1 $ $ $ $ 4.00 7.00 8.00 12.50 17.20 $ 22.00 $ 29.00 In the above table, the firm's total fixed cost of production is 2 3 4 5 сл LO 6 $99.70 $4 $29 $3 $7arrow_forward7. Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the figure. What plant size will the firm choose in producing (a) 50, (b) 130, (c) 160, and (d) 250 units of output? Draw the firm's long-run average-cost curve on the diagram and describe this curve. LO9.4 ATC 0 M 150 ATC2 ATC₁ ATC3 80 240arrow_forward
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