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andriy [413]
3 years ago
13

Suppose you are the manager of a watchmaking firm operating in a competitive market. Your cost of production is given by C = 200

+ 2q^2, where q is the level of output and C is total cost. (The marginal cost of production, MC(q), is 4q; the fixed cost, FC, is $200). a. If the price of a watch is $80, how many watches should you produce to maximize profits? (Enter your response as an integer.) b. What will the profit level be? (Enter your response rounded to two decimal places.) c. At what minimum price will the firm produce a positive output? (Enter your response as an integer.)
Business
1 answer:
irga5000 [103]3 years ago
4 0

Answer:

1. 20 units

2. $600

Explanation:

1. C = 200 + 2q^{2}

MC = 4q

Price, P = $80

For maximizing profits,

Marginal cost =  Price of the commodity

4q = 80

q = 20 units

C = 200 + 2q^{2}

C = 200 + 2(20)^{2}

         = 200 + 800

         = 1,000

2. Profit = Total revenue - Total cost

             = (Price × Quantity) - TC

             = (80 × 20) - $1,000

             = $1,600 - $1,000

             = $600

3. We know that the firm in the short run will be produce at a point where total revenue is greater than the total variable cost

Average variable cost = variable cost ÷ quantity

                              =\frac{2Q^{2}}{Q}

                                     = 2Q

MC = 4Q

Here,  MC is greater than AVC at any given point.

so in the short run firm will producing short run positive profit.

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kakasveta [241]

Answer:

False

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Explanation:

<em>Equivalent units are notional whole units which represent incomplete work and are used to apportion cost between work progress and completed work. These units are determined as follows:  </em>

Equivalent units = Degree of work done(%) × units of inventory

Item                                          unit                                    Equivalent unit

Opening inventory            10,000    50% ×  10,000                 5000

Fully worked unit                  80,000     100%× 80,000              80,000

Closing inventory              20,000       20% × 20,000              <u>4,000</u>

Total equivalent units                                                              <u> 89,000</u>

<u />

<u>Notes:</u>

<em>1. Fully work represent units started and completed in the same period. They exclude the opening inventory.</em>

<em>Fully worked = 90000- 10,000 =80,000.</em>

<em>2. Note also at that the degree of completion</em> for opening inventory is the simply the balance of work remaining to be done.

<em>For example, for materials, 50% of work has been done on the opening inventory in the last period, hence the balance of 50% would be done this period </em>

6 0
3 years ago
On January 15, Walton Company sold merchandise on account for $3,000 with terms 3/10, n/30. On January 20, the customer returns
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Answer:

The amount received in cash is $2,328

Explanation:

The amount which is received in cash is computed as:

On January 20, the amount of $600 goods returns from customer, so the remaining balance is

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On the remaining balance, the discount which is evaluated as the payment is received within the discount period which is January 25. So,

= $2,400 x  (100% - 3%)

= $ 2,400 x  97%

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Ne4ueva [31]

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baherus [9]

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  • credit of $30,000, overapplied.

<h3>Underapplied Overhead vs. Overapplied Overhead</h3>

Underapplied overhead is the opposite of overapplied overhead. Overapplied overhead occurs when expenses incurred are actually less than what a company accounts for in its budget. This means that a company comes in under budget and achieves a lower amount of overhead costs during the accounting period.

Therefore, the correct answer is as given above.

learn more about overhead account from here:

brainly.com/question/26396695

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