In a company operational activities are performed to fabricate products or to provide services. Within a company individual departments provide services not only for the main business but frequently also for other departments. Those services can be measured by their quantity, however due to lack of market prices they cannot be rated by values. The following table describes the services within the different department or for the main business as well as the primary costs of a company. recipient C D main business performance overall primary A B costs 1 2 0 2 8 14 1 1 1 1 10 С 2 1 2 24 1 1 6. 10 6. (a) Perform an internal cost allocation and determine the internal transfer prices. Describe your procedure. (b) Perform an input-output analysis without considering the primary costs. How much would each department have to produce in total to have y = (5, 2, 5, 4)T available for the main business? provider ABCD

In a company operational activities are performed to fabricate products or to provide services. Within a company individual departments provide services not only for the main business but frequently also for other departments. Those services can be measured by their quantity, however due to lack of market prices they cannot be rated by values. The following table describes the services within the different department or for the main business as well as the primary costs of a company. recipient C D main business performance overall primary A B costs 1 2 0 2 8 14 1 1 1 1 10 С 2 1 2 24 1 1 6. 10 6. (a) Perform an internal cost allocation and determine the internal transfer prices. Describe your procedure. (b) Perform an input-output analysis without considering the primary costs. How much would each department have to produce in total to have y = (5, 2, 5, 4)T available for the main business? provider ABCD

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter7: Proudction Costs

Section7.5: Long-run Production Costs

Problem 1YTE

See similar textbooks

Similar questions

What is die difference between accounting and economic profit?
In choosing a production technology, how will firms react if one input becomes relatively more expensive?
What are diminishing marginal returns as they relate to costs?
Most manufacturing companies divide manufacturing costs into which three broad categories?
Josh and Alex work as design engineers creating high-end lighting fixtures. After one particularly enlightened afternoon, they decide to follow their dreams and open a cupcake bakery. Please sort their various costs, listed below, into the correct category. Implicit Costs Not a Cost Explicit Costs ! Q A N Ⓒ2 Advertising space taken out on a social networking website The money they pay their neighbor's six year old son to deliver cupcakes to their customers. W S 12 #3 16 80 F3 E D X C $ 4 888 F4 R his previous job designing The salary Alex earned in lighting fixtures. LL 25 % U The garage space used for baking that can no longer be rented out to a college student FS T Da A 6 V B Y Supplies like sugar, butter and baking trays G H Ⓒ Previous Check Answer Next Exit 87 & 44 N 17 U J * 8 ∞ 3 14 9 K → 19 O 1 AA F10 P
IIT Ball Bearings Inc. faces costs of production as follows: Quantity Total Fixed Cost Total Variable Cost 100 100 100 100 100 100 100 1 50 70 90 140 200 360 3 4 5 (A) Calculate the company's average fixed costs, average variable costs, average total costs, and marginal costs. (B) The price of a case of ball bearings is $50. Seeing that she can't make a profit, the Chief Executive Officer (CEO) decides to shut down Operations. What are the firm's profits/ losses? Was this a wise decision? Explain. (C) Vaguely remembering his introductory economics course, the Chief Financial Officer Tells the CEO it is better to produce 1 case of ball bearings, because marginal revenue equals marginal cost at that quantity. What are the firm's profits/losses at that level of production? Was this the best decision? Explain
Which of the following are examples of indirect costs for a company that makes photograph frames and sells them to national retails chains? ii. Pay of assembly department's supervisor ii. Standard, off the shelf oil used for the cutting department iv. Pay of employees assembling frame O A. Picture frame moulding O B. i and ii only OC. ii and iii only OD. i, ii and iii only E. I, ii, iii and iv only
definition of economic costs
A computer company produces affordable, easyto-use home computer systems and has fixed costs of$250. The marginal cost of producing computers is $700for the first computer, $250 for the second, $300 for thethird, $350 for the fourth, $400 for the fifth, $450 for thesixth, and $500 for the seventh.a. Create a table that shows the company’s output,total cost, marginal cost, average cost, variablecost, and average variable cost.b. At what price is the zero-profit point? At whatprice is the shutdown point?c. If the company sells the computers for $500, is itmaking a profit or a loss? How big is the profitor loss? Sketch a graph with AC, MC, and AVCcurves to illustrate your answer and show theprofit or loss.d. If the firm sells the computers for $300, is itmaking a profit or a loss? How big is the profitor loss? Sketch a graph with AC, MC, and AVCcurves to illustrate your answer and show theprofit or loss.
Continue with the table and complete the calculation for Marginal Cost: Round to the table standard. Q3 Table Bags/ Participants Fixed Cost Variable Cost Total Cost Average Variable Cost Marginal Cost Total Revenue wt Price $20 Marginal Revenue Total Profit 0 1700 0 1700 0 -1700 100 1700 500 2200 a 2000 20 -200 200 1700 1200 2900 b 4000 20 1100 300 1700 2700 4400 c 6000 20 1600 400 1700 5200 6900 d 8000 20 1100 500 1700 9000 10700 e 10000 20 -700 600 1700 15000 16700 f 12000 20 -4700 700 1700 23800 25500 g 14000 20 -11500 800 1700 36800 38500 h 16000 20 -22500 900 1700 55800 57500 i 18000 20 -39500 1000 1700 83000 84700 j 20000 20 -64700
2. There are three student canteens serving different types of foods located at the campus. Table below shows the total costs of the catering services according to the number of students served. Number of Smile Canteen Rainbow Canteen Нарру Сanteen students served 500 15000 16000 19000 1000 28000 32000 40000 2000 50000 58000 80000 4000 80000 108000 168000 6000 114000 156000 258000 (a) Comment on the scale of production of these three canteens. (b) The owner of Happy Canteen decides to sell the business. The owner of Smile Canteen shows interest in it and has done an estimate on the total costs of running the two canteens under one ownership. Based on the estimates below, do you recommend the owner of the Smile Canteen to pick up the business of Happy Canteen? Explain. Number of students "Smile plus Happy" Canteen served in each canteen 500 40000 1000 65000 2000 110000 4000 215000 6000 390000
Times New Rom 12 A A Aa A == -=- E E T AaBbCcDc AaBbC AaBbCcC AaB AaBbCcD Аав O Find Replace BIU ab x, x A A- 目三==|m。 T Normal Heading 1 Heading 2 Title Subtitle Select Font Paragraph Styles Editing 1. 2. 4. 9. True or False 1.→Profit can-be calculated without including fixed costs. 2.→All costs can be categorized as either fixed or variable costs.T 3.→Total revenue accounts for all costs. 4.→One time-legal fees that move as services are rendered are considered variable costs. 5.→An-application fee and a fixed cost are basically the same. 6.→AVC+ AFC=TC. 7.→Short run costs are more associated with fixed costs rather than variable costs 8.→All average costs can be calculated by deriving the perunit costs 182 words MI DFocusBO e to search