Explain difference between explicit costs and implicit costs

Assignment Help Business Economics

Reference no: EM131242364

Cost of Production 1

a. Explain the difference between explicit costs and implicit costs and who would care about these terms and why.

b. From the point of view of a firm, how would you explain the difference between the short run and long run, and their impact on the decision-making of the firm?

i. How do you tell short run from long run and how will those distinctions impact the decision-making of the firm?

c. Your boss asks you to document your companies’ production function. How would you do that? What information would you need? Where would you get that info? Be specific.

i. What does the production function consist of?

ii. What does it tell us?

iii. How would you approach defining your company production function?

d. List and explain the Short Run Production Relationships.

Reference no: EM131242364

Questions Cloud

Reduce pollution from paper production is to reduce output : Suppose that the only way to reduce pollution from paper production is to reduce output. The government imposes a tax equal to the marginal harm from the pollution on the monopoly producer. Show that the tax may or may not raise welfare?

What equal monthly investment is required over period : What equal monthly investment is required over a period of 40 years to achieve a balance of $2,200,000 in an investment account that pays monthly interest of 0.25%? If montly interest is 2.5%

How much money is in the account immediately after deposit : On your girls first birthday, you open an account to fund her college education. You deposit $1500 to open the account. Each year, on her birthday, you make another deposit, with each being 10% larger than the previous deposit. The account pays inter..

What is the smallest integer-valued annual compound interest : What is the smallest integer-valued annual compound interest that will result in an investment tripling in value in less than or equal to 15 years?

Explain difference between explicit costs and implicit costs : Explain the difference between explicit costs and implicit costs and who would care about these terms and why. From the point of view of a firm, how would you explain the difference between the short run and long run, and their impact on the decision..

How much should he deposit in the account : He wishes to accumulate $30,000 in a savings account in 5 years. If he wishes to make a single deposit today and the bank pays 0.2% compounded annually on deposits of this size, how much should he deposit in the account

How is rent determined on plots of land of different quality : How is rent determined on plots of land of different quality? Does it matter whether or not the supply of factor inputs used on the land is perfectly elastic? Suppose that the factor supply curve is perfectly inelastic. What happens to land rent on e..

Determination of the rent-maximizing solution : Suppose that labor and fertilizer (another variable input) are used to produce crops from a piece of agricultural land. How much labor and fertilizer would the landowner use if he seeks to maximize land rent? Explain quantitatively the determination ..

Find the optimal monthly sales volume : A company manufactures several products. The fixed costs assigned to Product 'A' are $8,000 per month. The variable costs are $4.00 per unit produced. The per unit price (p) at which this product can be sold is related to the quantity sold per month ..

User Account

All Pages