labor a derived demand? Explain the shape of the supply of labor curve. What is the relationshipbetween productivity and the wages earned by an employee? What are some factors that determine the level of your income?
The concept of derived demand occurs when the demand of product exists due to demand...
Lecturer: Jaka Vadnjal
Homework 4: Production and costs
A. Briefly answer the following questions! (up to 3 lines typewriting)
A1. Distinguish between the short run and the long run.
*The long run is the conceptual time period in which there are no fixed factors of production as to changing the output...
price has increased by 20%. What is the book’s new price?
3. For each of the following pairs of variables, explain (i) whether there is likely to be a positive or negative relationshipbetween them, and (ii) which is the dependent and which is the independent variable.
(a) income and saving
Understand the meaning and significance of economics.
• Distinguish between microeconomics and macroeconomics.
• Explain various types of economic choices and to appreciate the concept of opportunity cost.
• Understand the marginal concepts and how they relate to rational choices.
• Construct, interpret...
Total cost - is the sum of the firm's variable costs
Profit - is the difference between total revenue and total cost
Explicit costs - is the opportunity costs of production...
the products and services sold to the market. (Total revenue = unit price x total no. of units)
b. Total cost
The total amount of the firm’s input which includes the explicit costs and implicit costs in order to produce a good or a service (output).
It is the difference between the...
(a) What is the difference between economies of scale and returns to scale? Explain.
An economy of scale is the cost advantages that a business obtains due to its expansion.
A return to scale is the changes in output resulting from a proportional change in all inputs (where all...
What is the difference betweenaverage, total, and marginal revenue? What is the shape of the total and marginal revenue curves for the individual competitive firm?
6. Why does price equal marginal revenue for the purely competitive firm? What is the relationship to the demand curve for...
Microeconomics section of the course introduces the students to basic economic concepts such as demand and supply, elasticity, economic profit and marginal analysis. The course will equip the student to demonstrate an understanding of modern economic theories of factor pricing, consumer and producer behaviour...
proportional change in quantity demanded between points A and B equals 5%
c. According to the point elasticity formula, the value of elasticity between points A and B equals 0.25
d. According to the point elasticity formula, the proportional change in price between points A and B equals 20%.
e. All of...
econonmMicroeconomics Review Quiz Test 2
1. When is marginal utility equal to zero?
A. When TU is zero.
B. When MU is at its maximum.
C. When TU is at its maximum.
D. When MU is at its minimum.
The following table shows Mia's $ marginal utility for litres of soya milk:
2. Refer to...
Question) Complete the following table by calculating marginalproduct and averageproduct from the data given. Plot total, marginal, and averageproduct and explain in detail the relationshipbetween each pair of curves. Explain why marginalproduct first rises, then declines, and ultimately becomes...
Define and explain the concept of a production function.
Draw and label the three different types of production functions. What do these graphs represent?
Draw a production function that starts out with increasing total product and moves into decreasing total product. Label the point of...
MASTERS IN BUSINESS ADMINISTRATION (MBA)
OBS 602: MANAGERIAL ECONOMICS
COURSE OUTLINE 1.0. INTRODUCTION There is always a wide gap between economic theory and the application of economic analysis, particularly at the microeconomic level. The theory of the firm is considered to be one thing;...
and their relationship will not help in understanding the economic laws and principles. These have to be understood in totality by asking questions such as why and how and going a step further by applying them to various situations.
Some of these concepts are:
o Marginal and average cost etc and...
5. Product: Returns To A Factor
Production: It is defined as transformation of inputs into output.
Production Function: It is defined as the technical relationshipbetween physical inputs and output. In other words, it is a technical relationship showing the maximum output that can be produced...
b) Explain how scarcity, choice and opportunity cost are relevant when choosing amongst
Define the concept of “opportunity cost” and discuss various examples.
Explain how the concept of opportunity cost may be used to explain the following:
Businesses and Their Costs
1. Explain the difference between a plant, a firm, and an industry.
Plant – establishments such as a factory, farm, mine or store.
Firm – an organization that employs resources to produce goods/services for profit.
6. Why does the problem of choice arise?
7. Define scarcity.
8. Give the meaning of opportunity cost.
9. Define marginal opportunity cost
10. What is a production possibility frontier?
11. State two characteristics of resources.
12. What does a rightward shift...
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