Calculating the types of costs

Assignments must be typed, with all calculations shown; diagrams can be hand drawn – – – insert your diagrams in the appropriate sections of your document.

Hand written assignments are not accepted.

Question 1. Mariam has decided to use her catering skills and start a vegetarian lunch business, she is operating in a competitive market and has the production costs given in the table below.

a. Complete the table by calculating the total cost, the average variable cost, the average total cost and the marginal cost for each quantity of output. [4 marks]

b. What is Mariam’s break-even price? What is Mariam’s shut-down price? Why? [2 marks]

c. If the market price is $21 per meal, will Mariam produce in the short run? Will she make a profit or loss? Explain. [2 marks]

d. If the market price is $17 per meal, will Mariam produce in the short run? Will she make a profit or loss? Explain. [2 marks]

e. If the market price is $13 per meal, will Mariam produce in the short run? Will she make a profit or loss? Explain. [2 marks]

f. Do you completely agree with the statement: “A firm’s supply curve is its marginal cost curve.”? Explain why or why not. [2 marks]

Total Quantity of Lunches (Q) Total Variable Cost Total Fixed Cost Total Cost Marginal Cost

 

Average Variable Cost Average Total Cost
0 $0 $100  

     
10 200    

 

 

 

20 300    

 

 

 

30 480    

 

 

 

40 700    

 

 

 

50 1,000    

 

 

 

Question 2. Jinfeng operates a book printing company in a competitive market structure which is currently in long-run equilibrium.

a. Draw, and carefully label all relevant points, depicting the market and a typical firm operating in this market which is in long-run equilibrium. [ 6 marks]

b. Jinfeng is very creative and develops a new technology which significantly reduces the variable costs of printing books. What will happen to Jinfeng’s profits and the price of books in the short run if he is able to prevent other firms from using this cost-saving technology?

Explain with words and illustrate the outcome with the use of an appropriate diagram. [6 marks]

c. What happens in the long-run to price and profits if Jinfeng is no longer able to prevent his competitors from adopting the same cost-saving technology? Explain what will happen to price, quantity and profit. [4 marks]

Question 3. Kayla started up a micro-brewery last fall and has hired Mason Consultants to help determine how she can main her current level of output while minimizing costs. The consulting company has determined an additional person-hour of labour would increase beer output by 2,000 litres per day. Adding an additional machine-hour of fermentation capacity would increase output by 400 litres per day. The hourly wage rate is $20 while the price of a machine-hour of fermentation capacity is $0.50 per hour. What recommendations do you think Mason Consultants made to Kayla to lower her costs? [2 marks]


Get Professional Assignment Help Cheaply

fast coursework help

Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?

Whichever your reason may is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.

Our essay writers are graduates with diplomas, bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college diploma. When assigning your order, we match the paper subject with the area of specialization of the writer.

Why Choose Our Academic Writing Service?

  • Plagiarism free papers
  • Timely delivery
  • Any deadline
  • Skilled, Experienced Native English Writers
  • Subject-relevant academic writer
  • Adherence to paper instructions
  • Ability to tackle bulk assignments
  • Reasonable prices
  • 24/7 Customer Support
  • Get superb grades consistently

How It Works

1.      Place an order

You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.

2.      Pay for the order

Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.

3.      Track the progress

You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.

4.      Download the paper

The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.

 

smile and order essaysmile and order essayPLACE THIS ORDER OR A SIMILAR ORDER WITH USA ELITE WRITERS TODAY AND GET AN AMAZING DISCOUNT

order custom essay paper
Published

Leave a comment

Your email address will not be published.