Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Microeconomics Expert

1. PURE WHITE CHALK Co. can lease for one period either of two factories. Leasing the small factory costs 5,000, and if firm leases small factory its total variable cost of production is given by TVCs(q) = q2/10,000. 
This, in turn, means that marginal cost of production for small factory is given by MCs(q) = q/5000.
Leasing large factory costs 18,000, and if firm leases large factory its total variable cost of production is provided by TVCL(q) = q2/20,000.
This, in turn, means that marginal cost of production for large factory is given by MCL(q) = q/10,000.
Suppose that firm can sell as many boxes of chalk as it wishes at a price of 2 per box.
Which factory must firm lease, and how many boxes of chalk must it manufacture?

2. Assume firm decided to lease large factory, and has put down non-refundable deposit of 4,000 for that factory.  Assume further that firm is worried about its decision and hires you as consultant. In answering following problems suppose that small factory is still available, and that if firm were to switch to small factory, only penalty that it faces is that it would lose the deposit of 4,000.

a. Give a recommendation concerning which factory firm must lease, and number of boxes of chalk it must manufacture.

b. It is sometimes said that smart business manager ignores sunk costs. describe whether your answer to b is consistent or inconsistent with idea that managers must ignore sunk costs.

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M923188

Have any Question? 


Related Questions in Microeconomics

Assignment land restoration proposalpart 1please see

Assignment: Land Restoration Proposal Part 1 Please see attachment for part 1 and only complete highlighted section for this assignment. Your team has been given the land rights to a 100-acre abandoned parcel of land. Th ...

Assignmentyou have been asked to assist your organizations

Assignment You have been asked to assist your organization's marketing department to better understand how consumers make economic decisions. Write a 1,050-word analysis that includes the following: • The impact the theo ...

Problem -the table below gives the income of each of four

Problem - The Table below gives the income of each of four individuals who are in a region. Calculate and plot the Lorenz curve and calculate the Gini coefficient for this economy. individual income 1 100 2 200 3 300 4 4 ...

Assignmentlinking questions 51 which one of the generic

Assignment Linking questions 5: 1. Which one of the generic competitive strategies best characterize your company's strategic approach to competing successfully? 2. Which athletic footwear companies in your industry appe ...

Application evaluation of research resultsno research

Application: Evaluation of Research Results No research project or study is perfect. Studies that contain errors can produce unreliable or misleading results. As a consumer of research, you must be able to determine the ...

Assignmentreview the cba provided in the resources section

Assignment Review the CBA provided in the resources section between the Trustees of Columbia University and Local 2110 International Union of Technical, Office, and Professional Workers. Describe how this is similar to a ...

Economic choice and economic decision makingconsider your

ECONOMIC CHOICE AND ECONOMIC DECISION MAKING Consider your last vehicle purchase and the decision making process you engaged in while deciding what vehicle to purchase or if a new vehicle was the right decision. While an ...

Project-listen to this video asafter you work on your graph

Project- Listen to this video as/after you work on your graph. The lecture is on the 'Aftermath of the Financial Crisis' given by Ben Bernanke in March 29 th 2012. https://www.c-span.org/video/?305198-1/ben-bernanke-lect ...

Assignmentwhat are the most important knowledge assets at

Assignment What are the most important knowledge assets at Dirt Bikes? What functions and employee positions are responsible for creating, distributing, and using these knowledge assets? Are all of these assets explicit ...

Assignmentvirtually all general managers face

Assignment Virtually all general managers face capital-budgeting decisions in the course of their careers. The most common of these is the simple "yes" versus "no" choice about a capital investment. Regardless of the typ ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro