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Dafna1 [17]
2 years ago
8

A firm in a purely competitive industry is currently producing 1,200 units per day at a total cost of $700. If the firm produced

1,000 units per day, its total cost would be $450, and if it produced 700 units per day, its total cost would be $425.
Instructions: In parts a and c, round your answers to 2 decimal places. In part d, round your answer to 1 decimal place.

a. What are the firm's ATC at these three levels of production?

At 1,200 units per day, ATC = $.

At 1,000 units per day, ATC = $.

At 700 units per day, ATC = $.

b. If every firm in this industry has the same cost structure, is the industry in long-run competitive equilibrium? (Click to select)NoYes.

c. From what you know about these firms’ cost structures, what is the highest possible price per unit that could exist as the market price in long-run equilibrium? $.

d. If that price ends up being the market price and if the normal rate of profit is 10 percent, then how big will each firm’s accounting profit per unit be? cents per unit.
Business
1 answer:
Andru [333]2 years ago
3 0

Answer:(a) $0.58, $0.45, $0.60 (b ) No the industry is not in long run competitive equilibrium (c) The highest possible price is $0.60 (d) The firm did not earn a profit in terms of accounting profit but loss of ($5)

Explanation:

To calculate the ATC

ATC = TC/ Quantity

At 1,200 unit per day

= 700/1,200

= $0.58

At 1,000 unit per day

= 450/1,000

= $0.45

At 700 unit per day

= 425/700

= $0.60

(b) No the industry is not in the long run competitive equilibrium because the cost is not stable it moves from $700 to $450 and then to $$425

(c) The highest possible price that could exist is $0.60

(d) since profit = Total Revenue - Total Cost

Total Revenue = price × Quantity, since the ATC is $0.60 and Total Cost = $425,Quantity = 700

$0.60 × 700 = 420

Therefore $420 - $425 = -$5

Therefore, in Accounting there is no profit but loss of ($5)

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those are the answers you are looking for
3 0
3 years ago
Read 2 more answers
he following information relates to the manufacturing operations of the Abbra Publishing Company for the year: Beginning Ending
Serhud [2]

Answer:

Purchases= $1,091,000

Explanation:

Giving the following information:

Beginning Raw materials inventory = $549,000

Ending Raw materials inventory= $612,000

The raw materials used in production= $1,028,000.

<u>To calculate the raw material purchased, we need to use the following formula:</u>

Purchases= production + ending inventory - beginning inventory

Purchases= 1,028,000 + 612,000 - 549,000

Purchases= $1,091,000

4 0
3 years ago
As it places its order for truck tires with Michelin, South Side Industrial Supply realizes that it must also place an order for
Dovator [93]

Answer:

The correct word for the blank space is: joint.

Explanation:

Joint demand refers to the demand for products and services that are dependent on each other. In such cases, those goods are complementary but they can be acquired separately if necessary. An example of goods with joint demand would be tea and sugar or a printer and ink.

8 0
3 years ago
ou have just purchased a four-month, $630,000 negotiable CD, which will pay a 4.5 percent annual interest rate. a. If the market
Serjik [45]

Answer:

Explanation:

first will need to calculate the Fv future value of this CD

Fv = Pv ( 1 + R )^n n = 4 /12 = 0.333333,  r, rate = 4.5/100 = 0.045

Fv = $ 630000 ( 1+ 0.045)^0.33333 = $ 639311.69

a) the current value at 5 % Pv = Fv / ( 1+r)ⁿ

Pv = $ 639311.69  / ( 1.05)^0.3333 = $ 628998.41

b) the current price at 4.25% = $ 639311.69  / ( 1.0425)^0.3333 = $ 630503.20

8 0
3 years ago
Beyond Space Aeronautics is developing a profit-sharing plan. Ben, the human resource manager, assumes the employees are excited
Nonamiya [84]

Answer:

The answer is D. Understanding that pay is not everything that employees are after and that there are several other means to keep them motivated.

Explanation:

Now lets take a closer look at it.

Option A is not going to work. Shutting down the basic communication system will render the organization members unable to cooperate with each other during their work and will make the matters even worse!

Option B is ridiculous. You remove employees just because you are suspicious of them to spread rumors? This will start other employees to doubt their own job security!

Option C is not going to work. You can tell them that rumors are against the company policy, but will they stop it just because of it?

Option E is somewhat acceptable. yet comparing with the option D, its not that much suitable. If the employees are already in doubt, it is unlikely that this option will work.

So, if option D is working, what are the non financial incentive that we can use to motivate our employees?

  1. Job Enrichment: Enrich their jobs with more responsibilities and by giving them more powers.
  2. Job Rotation: Employees get bored if they do the same work for a long period of time, changing the nature of the job they do is a good option in this case.
  3. Offer them leadership opportunities to develop in their career
  4. Recognize their contributions and efforts and appreciate them.
  5. Give your employees more autonomy and freedom
4 0
3 years ago
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