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Suppose a company is producing 1000 units of bottled power drink priced at $5. It is using a manufacturing process with a fixed cost of $1450 and a variable cost of $2.75 per unit (AVC).
Calculate the DOL and break even point for this production process. Is the company breaking even.
If the company installs updated machinery its fixed costs rise to $2000 and AVC drops to $2.25. Calculate the DOL and break even point.
At what production level should the company switch from the old machinery to the upgraded one.
If Advanta believes raising fees is a profitable move, then why would it delay implementing the higher fees, which could reduce the amount of profit generated by higher fees?
Why do you think firm 1's marginal cost is lower than firm 2's marginal cost? Determine the current profits of the the two firms. What would happen to each firm's current profits if firm 1 reduced its price to $6 while firm continued to charge $8?
IS Curve Exogenous Variables and Parameters Given the values in the table above, the real interest rate r = ________ when equilibrium output Y = 15.
One way to view the law of diminishing marginal productivity is to say that, The concept of derived demand can best be illustrated by the statement:
Given the following total-revenue function tr=9q-q2 (a) derive the total-, average-, and marginal- revenue schedules from q=0 to q= 6 by 1's
What did classical economists assume about the flexibility of prices, wages, and interest rates What did this assumption imply about the self-correcting tendencies in an economy in recession What disagreements did Keynes have with classical econom..
The Business Cycle is the short-term fluctuations in the economy relative to the long-term trend in output; the recurring and fluctuating levels of the GDP growth rate over time.
Calculate the marginal revenue product given this information and how many real estate agents will the manger hire if the wage rate is $32,000? Why?
Suppose the federal government needs to balance the budget, which means that when the government spending increases, taxes must increase equally. In this case, government spending multiplier is called the balanced-budget multiplier, defined as the..
Find the taxi firms profit maximizing or loss minimizing output level, Q. Calculate the monopolist's total profit. What is the monopolist's average profit?
When developing short-run cost curves, it is supposed that all firms in perfect competition have the same cost curves and they all make identical short-run profits or losses.
What will be the immediate impact on wages in each of the regions in the short run (before any migration between the North and the South occurs)?
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