A factory faces a total product curve that contains the following points. Quantity of Labour: 6,...
Question:
A factory faces a total product curve that contains the following points:
| Quantity of Labour | Total Product | FC | VC | TC | AC | AVC | MC |
|---|---|---|---|---|---|---|---|
| 6 | 1 | ||||||
| 10 | 2 | ||||||
| 13 | 3 | ||||||
| 15 | 4 | ||||||
| 18 | 5 | ||||||
| 23 | 6 | ||||||
| 30 | 7 | ||||||
| 40 | 8 |
(a) If labor costs $2 per unit, and the firm has a fixed cost of $30, construct tables showing variable cost, total cost, average cost and average variable cost curves.
(b) At approximately what point do diminishing marginal returns to labor set in?
Costs of Production in the Short-Run:
In the short-run, firms have two types of costs: Fixed costs and Variable costs. The sum of these two costs is the total cost of production. In the short-run at least one input is fixed and the cost of fixed input or inputs are called fixed costs. The costs of variable inputs are called variable costs.
Answer and Explanation: 1
Become a Study.com member to unlock this answer! Create your account
View this answer(a) Fixed costs are the costs paid to fixed input regardless of the amount of production. Hence fixed cost is always $30, whether the firm produces 1...
See full answer below.
Ask a question
Our experts can answer your tough homework and study questions.
Ask a question Ask a questionSearch Answers
Learn more about this topic:
Get access to this video and our entire Q&A library
Short-Run Costs vs. Long-Run Costs in Economics
from
Chapter 4 / Lesson 12
19K
Learn about short run vs. long run economics. Examine the definitions of short run and long run economics, and study examples of short and long run costs.
Related to this Question
- Suppose that your factory faces a total product and average variable cost curve. Total Product Variable Costs 1 $18 2 30 3 39 4 45 5 54 6 69 7 90 8 120 If labor costs $3 per unit, and you have fix
- The total product curve shows the relationship between total product (output) and _____; and the total cost curve shows the relationship between total cost and _____. A) the quantity of labor; the quantity of labor B) the quantity of output; the quantity
- A firm faces the following costs: total cost of capital = $1,500; price paid for labor = $12 per labor unit; and price paid for raw materials = $4 per raw-material unit. Now assume the firm improves its production process so that it can produce 6,500 unit
- A firm faces the following costs: total cost of capital = $1,500; price paid for labor = $12 per labor unit; and price paid for raw materials = $4 per raw-material unit. (Instructions: In parts a and b, round your answers to 2 decimal places. In part c,
- A firm faces the following costs: total cost of capital = $1,500; price paid for labor = $12 per labor unit; and price paid for raw materials = $4 per raw-material unit. Suppose the firm can produce 5,500 units of output this year by combining its fixed c
- A firm faces the following costs: Total cost of capital = $1500; price paid for labor = $14 per labor unit; and price paid for raw materials = $5 per raw-material unit. a. Suppose the firm can produce 5500 units of output this year by combining its fixed
- Suppose output can only be added to an industry in lumpy amounts. That is, a single factory can produce according to the following average total cost function: ATC(Q)=0.02Q^2 - 2Q + 60 And two factor
- Once you have the total product curve plotted with the below data, how do you calculate the average product of labor at different units of labor? and the marginal products of labor? 1 unit of labor = 2 outputs per week 2 units of labor = 6 output per we
- When 4 units of labor are employed, total product is 6 units; when 5 units of labor are employed, total product is 9 units of output. If the price of output is $5 per unit, what is the marginal reven
- Total product divided by the total quantity of labor employed equals the A. average product of labor. B. average total cost. C. marginal product of labor. D. average variable cost.
- An economist estimated that the cost function of single-product firm is C(Q) = 100 + 20Q + 15Q^2 + 10Q^3, where Q is the quantity of output. Calculate the total cost of producing 10 units of output.
- The figure above shows the total cost and total revenue curves for a firm. At which of the following levels of output is the firm maximizing profit? A. 1 unit B. 2 units C. 3 units D. 4 units
- Number of Workers Total Cost 0- 50 1 -110 2 -160 3 -200 4 -240 5 -250 6 -260 7 -280 8 -310 9 -350 10 -400 If hiring the 7th worker increases total product by 5 units and the price of each
- The average product of labor is A. the inverse of the average product of capital. B. total product divided by the total quantity of labor employed. C. the slope of the curve showing the total product of labor. D. the slope of the curve showing the margina
- A certain goods (x) produced in plant have total cost (y) defined by the equation of y = 30(x) + 25000. If Revenue (Y) defined as Y = 75(x). Compute the Breakeven point and fixed cost of this plant.
- Ball Bearings, Inc., faces costs of production as follows: Quantity Total Fixed Costs Total Variable Costs(Dollars)(Dollars)01000110050210070310090410014051002006100360 Complete the following table
- Suppose your firm's short-run production function is given as Labor Total Output 0 0 1 5 2 12 3 20 4 28 5 34 6 39 7 43 8 46 Assume that labor can be hired for $50 per unit and that your fixed cost is $1,000. a. What is the total varia
- An economist estimated that the cost function of a single-product firm is C(Q) = 100 + 20Q + 15Q^2 + 10Q^3, where Q is the quantity. Calculate the average total cost of producing 10 units of output.
- A firm is operating in the range of production where the law of diminishing returns has set in. The firm's total product when 10 units of labor are employed is 50. The marginal product of 11th unit of labor is 4. What is the firm's total product when 11 u
- Draw a production function that exhibits diminishing marginal product of labor. Draw the associated total-cost curve. (In both cases, be sure to label the axes.) Explain the shapes of the two curves you have drawn.
- A business incurs the following costs per unit: labor $125/unit, materials $45/unit, and rent $250,000/month. If the firm produces 1,000,000 units a month, calculate the following: A) Total variable costs B) Total fixed costs C) Total costs
- Let the Ball Bearings, Inc., faces costs of production as follows: Complete the following table by calculating the company's total cost, marginal cost, average fixed cost, average variable cost, and average total cost at each production level.
- Suppose that each firm that operates in an industry has a total cost curve given by TC = 7,000 + 50Q. In this industry, the lowest average total cost of producing 1,000 units of output occurs when:
- Suppose that each firm that operates in an industry has a total cost curve given by TC = 7,000 + 50Q. In this industry, the lowest average total cost of producing 1,000 units of output occurs when: f
- Harris Company manufactures a single product. Costs for the year 2015 for output levels of 1,000 and 2,000 units are given in the table. At each level compute the following: A. Total manufacturing costs B. Manufacturing costs per unit C. Total Variable
- Complete the missing portion of the production table below: Quantity of Labor Quantity of Capital Marginal Product of Labor Average Product of Labor Total Product of Labor 0 5 _____ _____ _____ 1 5 5
- The table above shows the total product schedule. Suppose that labor costs $20 per worker and fixed costs are $60. What is the average variable cost per unit when producing 80 units? A) $0.25 B) $1.00
- A factory produces output (Q) using capital (K) and labor (L) according to the production function Y(K,L)=K^{1/5}L^{4/5}. Let r denote the price per unit capital, and w denote the price per unit labor, so that the total expenditure on these factors is r_K
- Complete the following production table, where L is labor, TP is total product, MPL is the marginal product of labor, and APL is the average product of labor. L TP MPL APL 0 1 2 2 4 3 1 2 4 4
- The aggregate supply curve is a. a curve showing the quantities of total output that business will purchase for investment at various price levels b. a curve showing the quantities of total output tha
- When labor used is 12 units and output is 36, then a) the marginal product of labor is 3. b) the total product of labor is 1/3. c) the average product of labor is 3. d) None of the above.
- An economist estimated that the cost function of a single-product firm is C(Q) = 50 + 25Q + 30Q^2 + 5Q^3. Determine the total cost of producing 10 units of output.
- The following table shows the quantities of output produced by a firm and the amount of labor required to produce those quantities. The wage rate is $40 per worker and the fixed cost of production is
- A firm is producing its output based on the following cost schedule. How many units of output should it produce when the price of the product is $70, $85, or $95, respectively, and what is the firm's short-run supply curve? |Total Product|Fixed Cost|Varia
- Assume the total cost of production in a particular firm is 50000.00 while the fixed cost is 30000.00. The wages paid to each unit of labor is 2000.00. Calculate the unit of labor employed in this fir
- Suppose your business is currently 750 workers, the only variable input, at a wage rate of $48. The average product of labor is 96, the last worker added 6 units to total output, and total fixed cost
- A firm is producing two products, X and Y, in fixed proportions (one unit of X for each unit of Y). The firm's total cost and demand functions are as follows: TC = 100 + 6Q + Q^2, P_x &= 200 - Q_x, P_y = 150 - 2Q_y a. Given this information, how many unit
- A firm is operating with a total variable cost of R_s is 500 when 5 units of the given output are produced and the total fixed cost is R_s is 200. What will be the average total cost of producing
- An economist estimated that the cost function of a single-product firm is C(Q) = 100 + 20Q + 15Q^2 + 10Q^3, where Q is the quantity. Calculate the fixed cost of producing 10 units of output.
- Suppose a firm is hiring 20 workers at a wage rate of $60. The average product of labor is 30, the last worker added 12 units of output, and the total fixed cost is $3,600. a) The average total cost is $ [{Blank}], b) The marginal cost of the last unit
- Complete the following table given these assumptions 1. The manufacturing firm produces 100 units of output per day. 2. The price per unit of output is $75.00 3. The cost of transporting one unit of o
- A business incurs the following costs per unit: Labor $5/unit; Materials $3/unit and rent $5000/month. If the firm produces 1000 units a month, the total variable costs equals: a. $5,000. b. $8,000. c. $13,000. d. $10,000.
- A firm has cost function: C = 300 - 2Q + 3Q^2 The firm is producing 4 units of output. Calculate values tor these: a) total cost b) total variable cost c) total fixed cost d) avenge total cost
- If a firm employs 1 unit of labor, then 6 units of output will be produced; if it employs 2 units of labor, then 10 units of output will be produced; and if it employs 3 units of labor, then 12 units of output will be produced. It follows that A) total ou
- Consider the following table. A. Draw the total product curve. B. Find the marginal product (MP) and average product (AP) for each quantity of labor. Draw the graphs for MP and AP curves on the same plane. C. What can be said about the relationship betwee
- A firm's total cost is $1,000 if it produces one unit, $1,600 if it produces two units, and $2,000 if it produces three units of output. Draw up a table of total, average, and marginal costs for this
- An economist estimated that the cost function of a single-product firm is: C(Q) = 50 + 20Q + 25Q^2 + 5Q^3. Based on this information, determine the following: a. The fixed cost of producing 10 units
- An economist estimated that the cost function of a single-product firm is: C(Q) = 50 + 25Q + 30Q^2 + 5Q^3. Based on this information, determine the following: a. The fixed cost of producing 10 units
- An economist estimated that the cost function of a single-product firm is:C(Q) = 70 + 30Q + 20Q^2 + 10Q^3. Based on this information, determine the following: a. The fixed cost of producing 10 units o
- The marginal product of labor is the A. output level above which the slope of the total product curve falls. B. output level above which the rate of total product per unit of labor falls. C. maximum output attainable with fixed factors when labor is the o
- An economist estimated that the cost function of a single-product firm is C(Q) = 50 + 25Q + 30Q^2 + 5Q^3. Determine the average total cost of producing 10 units of output.
- The following table is a record of the data of a competitive firm on labour and output: Unit of labour Total product MPL VMPL 0 0 1 10 2 22 3 32 4 39 5 42 6 41 Suppose the product price is $5 and the market wage per unit of labour is $35. a)
- Consider the following production functions. Y = AK^{0.5}L^{0.5}, Y = AK + L A. Fixing total factor productivity (A) at 10 and capital employment (K) at 4 units, what is the marginal product of labor associated with labor employment of 25, 35, and 45 for
- Multi-product monopoly pricing. A single firm produces two goods with the following demands: Q_{1}=100-5P_{1}+bP_{2} and Q_{2}=50-P_{2}+2bP_{1}. Production is costless, so profit is the sum of total r
- A firm employs labor L and capital K = 10 to produce using the production function q = 60K^2L^2 - K^3L^3. Derive the total product of labor curve.
- The following table shows the total output produced in a factory at various levels of employment of labor. The firm sells each unit of output at $2 and each worker is paid a wage of $32. According to this table, what is the marginal product of the 5th wor
- The aggregate supply curve is: a. a curve showing the quantities of total output that a business will purchase for investment at various price levels. b. a curve showing the quantities of total output that will be offered for sale at various price levels.
- If total costs are $50,000 when 1000 units are produced, and total costs are $50,100 when 1001 units are produced, we can conclude that
- Figure 28-7 Labor Total Product 0 0 1 3 2 18 3 43 4 55 In Figure 28-7, assume that the resource and output markets are perfectly competitive. If the wage rate is $60 per unit of labor and the output price is $5 a unit, the MRP of the third laborer
- If a firm has the cost function TC = 25,000 - 25q , and the total quantity produced is 100 units, what is the firm's Average Variable Cost? a) 25000 b) 2500 c) 250 d) 25 Show work.
- A firm's labor input, total output of labor, and product price schedules are given below. If labor is the only variable input, how much labor should the firm employ if the wage rate is $8 per day? ||
- An economist estimated that the cost function of single-product firm is C(Q) = 100 + 20Q + 15Q^2 + 10Q^3, where Q is the quantity of output. Calculate the average fixed cost of producing 10 units of output.
- A firm produces an output with a fixed proportion production given by: f(x_1, x_2) = min(x_1, x_2). Assume that w_1 = 2 and w_2 = 4. A) Find an expression for the firm's total cost function in the lon
- A firm has total cost of $1,000 at 0 output and $2,600 at 4 units of output. The total fixed cost is A. 0 B. 1,600 C. 1,000 D. 650
- A firm has this cost function: [{MathJax fullWidth=?false? C=1000 + 6Q }]. The firm is currently producing 9 units of its product. Calculating these: A) average total cost B) Total fixed cost
- Use the following to answer questions 1 and 2 Number of Workers Total Product Product Price 0 0 5 00 1 10 4 75 2 18 4 25 3 26 3 75 What is the marginal product of the third worker
- The following table gives the total product schedule of labor. Find the corresponding average product and marginal product schedules of labor.
- The total fixed costs for manufacturing a product each month is $8,000. The variable cost per unit consists of direct labor, material and overhead. The labor will be based on the 25th unit and an 85%
- If each extra worker produces an extra unit of output, how do the total product of labor, the average product of labor, and the marginal product of labor vary with the number of workers?
- The following figure shows a firm's isoquant for producing 2,000 units of output and four isocost curves. Labor and capital each cost $50 per unit. a. At point A, the MRTS is [{Blank}] (less than, greater than, equal to) the input price ratio, w/r. The t
- Total Product Total Fixed Cost Total Variable Cost Total CostMarginal Cost 0 60 $0.00 1 60 $45.00 2 60 $85.00 3 60 $120.00 4 60 $150.00 5 60 $185.00 6 60 $225.00 7 60 270.00 8 60 $325.00 9 60
- Complete the table below. A worker costs $96 a day and the firm has fixed costs of $200. Round your answers to 1 decimal. What are the total costs for 6 workers? Show your work.
- Refer to the short-run production and cost data. In Figure A curve (1) is: A) total product and curve (2) is average product B) total product and curve (2) is marginal product C) average product and c
- Complete the table below. A worker costs $96 a day and the firm has fixed costs of $200. Round your answers to 1 decimal. What is the marginal product of labor of the 3rd worker? Show your work.
- Complete the table below. A worker costs $96 a day and the firm has fixed costs of $200. Round your answers to 1 decimal. What is the marginal product of labor of the 7th worker? Show your work.
- A business produces 400 items and sells them for $15 each for a total of $6,000. The total cost of producing the items is $4,500 in explicit cost and $1,000 in implicit cost. Economic profit is: a. $
- Firm A is producing 40,000 units of output, incurring a total cost of $1,000,000 and total variable cost of $200,000. What is Firm A's average fixed cost?
- Given the following production function: TP = 100L + 5L 2 -L 3 Where L=units of labor, TP=total product a) Calculate the AP and MP of labor. b) Using the Excel to create a table, that included the T
- This firm has a wage of $100 per worker, according to the following output schedule, the marginal cost when the firm is producing 15 units. Marginal cost is Labor Output 1 5 2 15 3 20 4 24
- When the total product curve is drawn in a figure that measures employment along the horizontal axis, it is a graph that shows the A. maximum output attainable for each quantity of labor employed. B. minimum cost of producing a given amount of output usin
- In the graph below, it is shown the firm's average product of labor and the marginal product of labor curves. The price of labor is $60 per unit. Given this, diminishing returns set in with the: a. 3rd unit of labor b. 6th unit of labor c. 10th unit of
- An economist estimated that the cost function of a single-product firm is: C(Q) = 60 + 30Q + 25Q2 + 5Q3. Based on this information, determine the following: a. The fixed cost of producing 10 units of
- An economist estimated that the cost function of a single-product firm is: C(Q) = 70 + 20Q + 25Q^2 + 10Q^3. Based on this information, determine the following: a. The fixed cost of producing 10 units
- An economist estimated that the cost function of a single-product firm is: C(Q) = 70 + 20Q + 25Q2 + 10Q3. Based on this information, determine the following: a. The fixed cost of producing 10 units o
- An economist estimated that the cost function of a single-product firm is: C(Q) = 60 + 25Q + 15Q2 + 10Q3. Based on this information, determine the following: a. The fixed cost of producing 10 units of
- Suppose that a firm is currently employing 20 workers, the only variable input, at a wage rate of $250. The average physical product of labor is 25, the last worker added 10 units to total output, and the total cost is $5,000.What is the average total cos
- The production function of a firm is Total product = 45L^2 - L^3 where L is labor. How many units of labor should be employed to maximize output?
- A firm has a fixed cost of $700 in its first year of operation. When the firm produces 99 units of output, its total costs are $4,000. The marginal cost of producing the 100th unit of output is $200. What is the total cost of producing 100 units?
- A firm used Labor (L) and Machines (M) according to the production function The marginal products are The cost of Labor is $40 per unit and the cost of using Machine is $10. a. Suppose the Firm wants
- a. Suppose the firm can produce 5,000 units of output this year by combining its fixed capital with 100 units of labor and 450 units of raw materials. What are the total cost and average total cost of producing the 5,000 units of output?
- A firm's total cost is $10,957 when it produces a quantity of 50 units. Rounded to the nearest dollar, what is the firm's average total cost at this quantity? a. $413 b. $250 c. $219 d. $187 e. none of the above
- Consider the following production function: Q=5L + 20K where Q is total output, L is the quantity of labor employed and K is the quantity of capital employed. What is the marginal product of labor? O
- If a firm hires another worker and her marginal product of labor is 0 (zero), we know that the firm's total output is.
- The total cost function of a firm operating in a perfectly competitive market is C(Q) = 10 + 2Q + .5Q2. The firm's product is set by the market at $35. a. What level of output should this firm produc
- An economist estimated that the cost function of single-product firm is C(Q) = 100 + 20Q + 15Q^2 + 10Q^3, where Q is the quantity of output. Calculate the variable cost of producing 10 units of output.
- A business incurs the following costs: Labor: $195/unit Materials: $45/unit Rent: $150,000/month Assume the firm produces 1 million units per month. Calculate 1. The total variable cost, per month. 2. The total fixed cost, per month. 3. The tot
- Harris Company manufactures a single product. Costs for 2008 for output levels of 3,000 and 6,000 units are as follows: At each level of output, compute the following: A) Total manufacturing costs. B)
- Suppose that when producing 10 units of output, a firm's AVC is $22, its AFC is $5, and its MC is $30. Which of the following is true? a. total cost is $250 b. total fixed cost is $220 c. total fixed cost is $500 d. total variable cost is $220
- An economist estimated that the cost function of a single-product firm is: C(Q) = 90 + 30Q + 25Q2 + 10Q3. Based on this information, determine the following: a. The fixed cost of producing 10 units of output. b. The variable cost of producing 10 units of
- Suppose a company incurs the following costs: Labor $400 Equipment $300 Material $100. However, it owns the building so doesn't have to pay the $800 in rent. (a) What is the total accounting cost? (b) What is the total economic cost?
Explore our homework questions and answers library
Browse
by subject