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3 years ago

Assume that a purely competitive firm has the following schedule of average and marginal costs:

Business

1 answer:

tia_tia [17]3 years ago

4 0

Answer:

a) At a price $55, the firm would produce 3 units of output.

At a price of $120, the firm would produce 6 units of output.

At a price of $200, the firm would produce 7 units of output.

The rule is Price = Marginal Cost for a competitive firm

b) The per-unit economic profit (or loss) is calculated by subtracting ATC at a particular level of output from the product price. This per-unit economic profit is then multiplied by the number of units of output to determine the economic profit for the competitive firm.

i) At the product price of $200, the average total costs are $146 , so per-unit economic profit is $54 . Multiplying this amount by the number of units of output results in an economic profit of $378 .

Explanation:

At P = 200, output produced is 7 units

ATC is $146

Per-unit economic profit = 200 - 146 = $54

Hence, Total economic profit = $54 x 7 = $378

ii) At the product price of $120, the average total costs are $140 , so per-unit economic losses are $ -20. Multiplying this amount by the number of units of output results in an economic loss of $-100.

Explanation: At P = 20, output produced will be 5 units. 6th unit will not be produced as it will result in even greater loss.

Total loss = ($140 - $120) x 5 = $100

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BreatheDeep, a monopolist, produces 10,000 doses of medicine for sever asthma at a cost of $4 per dose. If each dose is sold for

Vlad [161]

Answer:

If all the doses were sold, the total profit would be of $80,000.

Explanation:

To obtain the economic gain of a business, the production cost must be subtracted from the sales value of the products sold. In the case, the 10,000 products were sold at $ 12, giving a total sales revenue of $ 120,000. But in turn, those 10,000 products cost $ 4 each, giving a total production cost of $ 40,000. Therefore, the profit of BreatheDeep, after subtracting production costs, is $ 80,000.

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3 years ago

The most effective audit procedure for determining the collectibility of an account receivable is the

Schach [20]

The utmost effective audit procedure for determining the collectability of an account receivable is the, review of the subsequent cash collections. Reviewing the subsequent cash collections speeds up the audit procedure to determine the collectability of an account receivable.

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3 years ago

Indicate whether the following statements about the conceptual framework are true or false. (a) The fundamental qualitative char

Novosadov [1.4K]

Answer:

True or False Statements about the conceptual framework:

(a) False: The fundamental qualitative characteristics that make accounting information useful are relevance and faithful representation, which suggest materiality and completeness respectively.

(b) False: Relevant information must also be material in a financial statement user's decision, in addition to having predictive and confirmatory values.

(c) False: It is information that is relevant that is characterized as having predictive or confirmatory value, and not information that shows faithful representation.

(d) False: Comparability also refers to comparisons of a firm over time (which is appropriately described as consistency). This is in addition to the similar reporting of information by different companies.

(e) False: Enhancing characteristics do not relate only to faithful representation but also to relevance.

(f) True.

Explanation:

Faithful representation implies completeness. Relevance means that the disclosure will attract important consideration and is material to the matter. Therefore, users of financial reports base their decisions on relevant information and not irrelevant details.

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3 years ago

Who benefits from an import-substitution strategy? who is harmed?

Aloiza [94]

Answer:

Import substitution industrialization (ISI) is a trade and economic policy which advocates replacing foreign imports with domestic production. Domestic consumers benefit from import substitution as they do not have to face strong competition from foreign competitors and can sell their goods at a higher price. So for example manufacturers in USA sell a battery from $10 but consumers from USA have the option to import that battery at $7 from China the US manufacturers wont be able to compete as Chinese companies have lower cost of production therefore they can sell cheaper and in order to protect the local manufacturers the government may use an ISI strategy to help the local manufacturers. On the other hand consumers are harmed from this strategy as they cannot buy the cheaper product because of change in government strategy. So consumers who were buying the battery at $7 not have to buy it at $10.

Explanation:

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2 years ago

Why does electronic commerce benefit small firms? Without e-commerce, small firms often lack the resources to expand beyond loca

Juli2301 [7.4K]

Answer:

Without e-commerce, small firms often lack the resources to expand beyond local markets.

Explanation:

In Business, e-commerce can be defined as a business model which involves the buying and selling of goods or products over the internet.

Generally, e-commerce comprises of four (4) business models and these are;

1. Business to Business (B2B).

2. Business to Consumer (B2C).

3. Business to Government (B2G).

4. Consumer to Consumer (C2C).

Without e-commerce, small firms who predominantly lack the resources to expand beyond local markets unlike larger business firm wouldn't be able to grow and develop into penetrating global markets.

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2 years ago