Question: Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure. What plant size will the firm

Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure.


Suppose a firm has only three possible plant-size options, repre


What plant size will the firm choose in producing?

(a) 50,

(b) 130,

(c) 160,

(d) 250 units of output?

Draw the firm’s long-run average-cost curve on the diagram and describe this curve.

ATC ATC2 , 80 150 240

Step by Step Solution

★★★★★

3.45 Rating (161 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

a To produce 50 units the firm will choose plant size 1 since its ATC is lower for t... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

252-B-E-M-E (1819).docx

120 KBs Word File

Students Have Also Explored These Related Economics Questions!

Q:

Three alternative processes shown in the accompanying figure are suggested to change the state of one kg of air from 0.8 MPa, 25C (state-1) to 0.3 MPa, 60C (state-5). Process 1-2-5 consists of a...

Q:

The axisymmetric parts shown in the accompanying figure are to be produced through P/M. Describe the design changes that you would recommend?

Q:

A network of GNSS observations shown in the accompanying figure was made with two receivers using the static method. Use Wolfpack to adjust the network, given the following data? Station X (m) Bonnie...

Q:

9. Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure. What plant size will the firm choose in producing ( a ) 50, ( b ) 130, (...

Q:

Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure. What plant size will the firm choose in producing 50, 130, 160 and 250...

Q:

9. Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure. What plant size will the firm choose in producing ( a ) 50, ( b ) 130, (...

Q:

11. Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure. What plant size will the firm choose in producing (a) 50, (b) 130, (c)...

Q:

11. Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure. What plant size will the firm choose in producing (a) 50, (b) 130, (c)...

Q:

11. Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the accompanying figure. What plant size will the firm choose in producing (a) 50, (b) 130, (c)...

Q:

6. Suppose a firm has only three possible plant-size options, represented by the ATC curves shown in the figure below. What plant size will the firm choose in producing (a) 50, (b) 130, (c) 160, and...

Q:

The data of Prob. 11.31 correspond to a pump speed of 1200 r/min. (Were you able to solve Prob. 11.31 without this knowledge?) (a) Estimate the diameter of the impeller [HINT: See Prob. 11.24 for a...

Q:

Regarding dividend payments by corporations, default will arise when:Select one:a . Common shares are authorized and issued but no dividend payment has been announced within 1 2 0 days after fiscal...

Q:

15. ETFs versus Mutual Funds (LO4, CFA2) Suppose you just inherited $25,000 from your Aunt Louise. You have decided to invest in an S&P Index fund, but you haven't decided yet whether to use an ETF...

Q:

Suppose you are an economist working for the Antitrust Division of the Department of Justice. In each of the following cases you are given the task of determining whether the behavior warrants an...

Q:

The accompanying table shows the demand schedule for vitamin D. Suppose that the marginal cost of producing vitamin D is zero. Price of vitamin D Quantity of vitamin (per ton) D demanded (tons) $8. 0...

Q:

The market for olive oil in New York City is controlled by two families, the Sopranos and the Contraltos. Both families will ruthlessly eliminate any other family that attempts to enter the New York...

Q:

A terminated employee is not entitled to COBRA benefits if he is terminated for gross misconduct. Group of answer choices True False

Q:

____________ usa tecnologa que permite a los humanos interactuar con una computadora a travs de sensaciones y movimientos corporales, por ejemplo, un telfono celular que vibra en su bolsillo. Opcin...

Q:

You must evaluate the purchase of a proposed ipectrometer for the R8D department, The base price is $220,000, and it would cost another 544,000 to modify the equipment for spedal use by the firm. The...