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Dennis_Churaev [7]
4 years ago
10

Megatron is a competitive firm operating under the following conditions: Price of output is $15, the profit maximizing level of

output is 40,000 units, and the total cost (full economic cost) of producing 40,000 units is $650,000. The firm's only fixed factor of production is as $750,000 stock of capital (a building). If the interest rate available on a comparable risks is 8 percent, should this firm shut down immediately in the short run? Explain your answer.
Business
1 answer:
insens350 [35]4 years ago
7 0

Answer:

Firm should be shut down in short run

Explanation:

We have given price of output = $15

Total economic cost = $650000

Total number of units for maximizing profit level = 40000

So average economic cost =\frac{650000}{40000}=$16.25

As the average economic cost is greater than price of the output

So firm should be shut down in short run

Answer will be firm should be shut down in short run

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Hadley Corporation, which has only one product, has provided the following data concerning its most recent month of operations:
Greeley [361]

Answer:

Total period cost for the month $65,240

Explanation:

Product cost under variable costing = Direct materials + Direct labor + Variable overheads

Period cost under variable costing = Fixed manufacturing overheads + All non manufacturing overheads (Variable and fixed)

Calculation of the total period cost using variable costing

Variable selling and administrative expense ($11 × 1,380 units)

$15,180

Fixed manufacturing overhead

$19,700

Fixed selling and administrative expense

$30,360

Total period cost for the month

$65,240

6 0
3 years ago
A monopolist’s cost function yields constant average and marginal costs, with AC = MC = 5. The firm faces a market demand curve
Nitella [24]

Answer:

a. Marginal Revenue = 5  

b. Maximum profit = $144

c. Q optimum = 12 ; P optimum = $17

d. Social cost = $72

Explanation:

Step 1. Given information.

  • MC=AC=5
  • P=29-Q

Step 2. Formulas needed to solve the exercise.

  • Total Revenue=TR=P*Q=(29-Q)*Q=29Q-Q2  
  • Marginal Revenue=dTR/dQ=29-2Q

Step 3. Calculation.

Set MR=MC for profit maximization  

29-2Q=5  

2Q=29-5

Q=12 -----profit maximizing output

P=29-Q=29-12=$17 -------profit maximizing price

Total Profit=(P-AC)*Q=(17-5)*12=$144 ------Maximum Profit

Lerner's Index=(P-MC)/P=(17-5)/17=0.7059

<h2></h2><h2>TAKE A LOOK TO THE ATTACHED IMAGE</h2>

Profit is shown by rectangular shaded area.

Socially optimal price P=MC=$5 --------Socially optimal price

We know P=29-Q, Set P=5

5=29-Q

Q=24 ---------Socially optimal output

Social Cost is equal to dead weight loss. It is shown by triangular area DWL

Social Cost=1/2*(17-5)*(24-12) =$72

5 0
3 years ago
If employers do not require a(n) __________, performance appraisal ratings often do not match the normal distribution of a bell-
Lubov Fominskaja [6]

Answer:

forced distribution

Explanation:

Based on the rest of the sentence it can be said that the missing term is forced distribution. This is a system that requires managers to evaluate each individual and rank them typically into one of three categories. These categories are excellent, good, and poor and allow managers to indicate if the employee should be terminated, is doing good, or is in-line for promotion as indicated in the graph below. This term is also known as the vitality curve or bell curve.

4 0
3 years ago
The Porch Cushion Company manufactures foam cushions. The number of cushions to be produced in the upcoming three months​ follow
vodomira [7]

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

Number of foam cushions to be produced in July 13, 000

Number of foam cushions to be produced in August 12, 000

Number of foam cushions to be produced in September 14, 000

Each cushion requires 2 pounds of the foam used as stuffing. The company has a policy that the ending inventory of foam each month must be equal to 25% of the following​ month's expected production needs.

Production for August:

Sales= 12,000*2= 24,000

Ending inventory= (14,000*0.25)*2= 7,000

Beginning inventory= (12,000*0.25)*2= 6,000 (-)

Total= 25,000 pounds

5 0
3 years ago
in a well-diversified investment portfolio, the allocation of real estate investments should not exceed five percent.a. Trueb. F
Dmitry_Shevchenko [17]

"In a well-diversified investment portfolio, the allocation of real estate investments should not exceed five percent" is false.

<h3>What is real estate?</h3>

⇒ Real estate is immovable property of this type that consists of land and the buildings on it, as well as its natural resources, such as crops, minerals, or water; an interest in this (also) constitutes real property, or (more broadly) buildings or houses in general. In legal terminology, real refers to real property, which is distinct from personal property, and estate refers to a person's "interest" in that real property.

Real estate is distinct from personal property, which includes things like cars, yachts, jewels, furniture, equipment, and a farm's rolling stock but is not affixed to the land permanently.

To learn more about real estate, visit:

brainly.com/question/1534216

#SPJ4

4 0
1 year ago
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