Managing monopolistic and competitive markets

Assignment Help Microeconomics

Reference no: EM1371750

You're the GM of firm that manufactures PC's. Demand for them has dropped 50%, thanks to soft economy. The sales manager has identified only one potential client, who has received many quotes for 10000 new PC's. According to the sales manager, the client is willing to pay $650 each of the 10000. Your production line is idle, so you can make them easily. The accounting department provided you with the following info about the unit(average) cost of producing 3 potential quantities of PC's:

10000 PC's 15000 PC's 20000 PC's

Materials 500 500 500
Depreciation 200 150 100
Labor 100 100 100

Total Unit Cost 800 750 700

Based on this info, should you accept the offer to produce 10000 at $650? Explain.

Reference no: EM1371750

Questions Cloud

Show the process analysis and methods for evaluation : Describe process analysis and what steps could be used to analyze a process? What methods might best be used to evaluate and improve a given process?

Estimating stage 2 of production function : Given the Production Function: Q = 21X + 9X2 - X3, where Q = Output, and X = Input . At what value of X does Stage II of the production function begin?

Discussion on gross domestic product : The questions asked if a paper mill manufactures $1 million worth of paper this year but adds considerably to the pollutants in a nearby river, are the social expenses arising from this pollution reflected in the gross domestic product?

Conduct a search to develop a working knowledge : Conduct a search to prepare a working knowledge of your selected subject and show how you would narrow the subject to focus on a specific topic so that your research is researchable

Managing monopolistic and competitive markets : You're the GM of firm that manufactures PC's. Demand for them has dropped 50%, thanks to soft economy. The sales manager has identified only one potential client, who has received many quotes for 10000 new PC's.

Program to input name and price of the item : Program must input name and price of the item and its weight in pounds and ounces. Then it must determine and display unit price per ounce of that item.

Managerial accounting-analysis of cvp : Suppose that MN Company is currently selling 300 units of Product SD per month. Management wants to increase sales and feels this can be done by cutting the selling price by $22 per unit and increasing the advertising budget by $20,000 per month. ..

Comparative rankings : If by bad management components of a corporation become competitive, the system is destroyed. A common example lies in the practice of ranking people,

Decisions of short run production-price decline : A firm produces 10 units per week at a price of $500 each. With AFC of $100 and AVC $350 per unit, the firm is earning economic profits of $500 per week.

User Account

All Pages