What are the maximum profits this firm can earn

Assignment Help Econometrics
Reference no: EM13213806

On page 170 A firm's product sells for $per unit in a highly competitive market. The firm produces output using capital (which it rents at $75 per hour) and labor (which is paid a wage of $15 per hour under a contract for 20 hours of labor services). Complete the following table and use that information to answer the questions that follow. K L Q MPK APK APL VMPK 0 20 0 1 20 50 2 20 150 3 20 300 4 20 400 5 20 450 6 20 475 7 20 475 8 20 450 9 20 400 10 20 300 11 20 150

a. Identify the fixed and variable inputs.

b. What are the firm's fixed costs?

c. What is the variable cost of producing 475 units of output?

d. How many units of the variable input should be used to maximize profits?

e. What are the maximum profits this firm can earn?

f. Over what range of the variable input usage do increasing marginal returns exist?

g. Over what range of the variable input usage do decreasing marginal returns exist?

h. Over what range of input usage do negative marginal returns exist?

Reference no: EM13213806

Questions Cloud

Which grant should you apply for : Assuming that your non-profit is risk-neutral, which grant should you apply for - assuming that your non-profit is risk-averse, with U(X)=sqrt(X) where X is the amount of grant money received, which grant should you apply for?
What is the future value of all the costs of owning : A company is considering buying a new bottle-capping machine. The initial cost of the machine is $325,000 and it has a 10-year life. Monthly maintenance costs are expected to be $1200 per month for the first 7 years and $2000 per month for the rem..
Diaphoresis-macule-ulcer-epidermis : Diaphoresis, Macule, Ulcer, Epidermis, Ecchymosis, Wheal
Determine the volumetric flow rate : Liquid phenol (C6H5OH) flows through a pipe with a mass flow rate of 83.0 g/s. Given that the density of phenol is 1.0576 g/cm3
What are the maximum profits this firm can earn : On page 170 A firm's product sells for $per unit in a highly competitive market. The firm produces output using capital (which it rents at $75 per hour) and labor (which is paid a wage of $15 per hour under a contract for 20 hours of labor service..
What is market rate of substitution between goods x and y : A consumer has 400 to spend on goods X and Y. The market prices of these two goods are Px = $10 and Py = $40. a. What is the market rate of substitution between goods X and Y b. Illustrate the consumer's opportunity set in a carefully labeled diag..
Find what is the new temperature of the tank : The johns family has a water tank that can deliver 10,000 cu ft of CO2 qt 20 degrees celcius with a pressure of 1ATM If the johns tank volume was cut in half and the pressure increasses
One argument against annexing texas : One argument against annexing Texas to the US was that the annexation
What is the firms equivalent variation : What is (the magnitude of) the firm's equivalent variation (EV) for the wage decreasedescribed above? Does this amount represent a willingness to pay or a willingness to accept?

Reviews

Write a Review

Econometrics Questions & Answers

  What total surplus will result from a transaction

Consider a seller who values a car at $9,500 and a buyer who values the same care at $10,000. What total surplus will result from a transaction between the two when the seller is faced with the follow sales tax rates: 0%, 2%, 4%, 6%, and 8%

  Determine the marginal cost of a television

suppose the marginal cost of a television is $100 the annual demand for the television set its given by the equation Q=200,000-500(p) question: suppose television sets are banned calculate the loss in consumer surplus as a result of this action

  Discuss the possible implication of non-stationarity

Identify whether the variables in your model suffer from non-stationarity. Discuss the possible implication of non-stationarity for your model and how this problem could be addressed.

  What would the maximum possible profit be

Susanna Nanna is the production manager for a furniture manufacturing company. The company produces tables (X) and chairs (Y). Each table generates a profit of $80 and requires 3 hours of assembly time and 4 hours of finishing time. Each chair gen..

  Derive the short-run market supply curve

Suppose that there are 80 firms in a market, each with the following cost function: C(q) = 100 + 4q^2 A.) Derive the short-run market supply curve. B.) Suppose the market demand is Qd= 1280 - 30P Find the equilibrium market quantity and price.

  Calculate real compound annual rate of return on investment

Michael Illitch bought the Detroit Tigers in 1992 for $82 million, which amounted to $114.15 million in 2005 dollars. by 2005, the Tigers were worth $292 million. Calculate the real compound annual rate of return on that investment.

  What prices should the firm charge in these markets

The demand schedule in the first market is Q1=100-0.5P1, where P1 is the price of the product and Q1 is the amount sold in the market. In the seconds market, the demand is Q2=140-P2, where P2 is the price of the product and Q2 is the amount sold i..

  Calculating the average days past due and average flow time

Auto Data manufactures custom engineering testing machine. The following 5-orders are currently in the design department:

  Determine interest rate

The football coach at Midwestern university was given a 5 year employment contract that paid $225,000 the first year, and increased 8% uniform rate in each subsequent year. At the end of the first year the alumni demanded that he be fired.

  Explain how to draft a fund- raising letter

If you want to raise as much money as possible, would it be better if the text of that section men- tioned that your school is #3 in the nation in sports or that you are better than 99% of other schools at sports

  By what percentage did gdp decline in the fourth quarter

According to the News on page 162 : Economy: Sharpest Decline in 26 Years The U.S. economy suffered its biggest slowdown in 26 years in the last three months of 2008, according to the government's first reading about the fourth quarter released Fr..

  How to determine the daily income and budget set

Pizza costs $4 a slice and cigarettes cost $10 a pack. Evan currently uses his daily income to purchase 10 slices of pizza and 2 packs of cigarettes a day. How do I determine the daily income and budget set and as far as graphing goes

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd