Answer:
units of output = 2 units
fixed cost = 8
Explanation:
given data
SMC = 2 + 4Q
AVC = 2 + 2Q
to find out
how many units of output will it produce at a market price and what level of fixed cost will this firm earn zero economic profit
solution
we know here that under perfect competition
so at the equilibrium here Price (P) will be = MC
P = MC = 10
and
SMC = 2 + 4Q ,
P = 2 + 4Q
10 = 2 + 4Q
Q = 2 units
and
at zero economic profit we get
TR = TC
TR = P × Q
TR = 10 × 2
TR = 20
so
TC = TFC + TVC
20 = TFC + 12
TFC = 8
because here [ TVC = AVC × Q ]
[ TVC = (2 + 2 × 2) × 2 ]
[ TVC = 12 ]
A cost that remains unchanged in total despite variations in the volume of activity within a relevant range is a fixed cost. The fixed cost is a type of cost behavior which remains unchanged regardless of the unit or activity changes in a production process<span>. There are four types of cost behavior, which are the fixed cost, the variable cost, the mixed cost, and the step cost.</span>
The answer is product's position. This involves the impression, perception, and feeling of the consumer to a product relative to competing brands. It is also about positioning the product in the consumer minds and its ability to be differentiated from others.
Answer: The assets that are classified as plant assets on the company's balance sheet include :
(1) the showroom building, a separate building used to service customer cars, and various parking lots.
Plant asset is known as the long-term fixed asset that is used to bring forth or sell commodities and services for the institution. These assets are tangible and are expected to produce economic benefits for the organization.
