Opportunity Cost Lets start with a small introduction to the topic Opportunity Cost. Opportunity cost is the cost of any activity measured in terms of the value of the next best alternative forgone (that is not chosen). It is the sacrifice related to the second best choice available to someone‚ or group‚ who has picked among several mutually exclusive choices. The opportunity cost is also the "cost" (as a lost benefit) of the forgone products after making a choice. Opportunity cost is a
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Chapter 05 Production and Cost Essay Questions 1. Always Round Tire has a production function of Q = 300 L.75 K.5. In the short run‚ if L = 250 and K = 25‚ what happens to the output of tires if L jumps to 300 and then 350. What law does this illustrate? When L=250 and K=25 then Q=94307. When L increases to 300‚ Q increases to 108‚127. When L increases to 350‚ Q increases to 121‚379. This shows the effects of diminishing marginal returns to labor as a factor of production.
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the average variable cost is a. at the same level of output as the minimum average total cost b. at a smaller level of output than the minimum average total cost c. at a larger level of output than the minimum average total cost d. at the same level of output as the average fixed costs e. same as minimum marginal cost 2. The multiplant monopolist maximises profits when a. Marginal cost equals marginal revenue b. When marginal cost in each plant are equal c. When average cost in each plant
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Economic Cost of “Power Outages” By Dr. Aisha Ghaus-Pasha Table of Contents Page No. 1. Causes of Power Outages 1 2. Quantifying Outage Costs 2 3. Incidence of Outages 4 4. Pattern of Direct Costs 5 5. Types of Adjustments to Outages 5 6. Extent of Recovery of Output 6 7. Total Outage Costs to the Industrial Sector 6 8. National Costs of Load Shedding 7 9. Policy Implications 9 9.1. Investment in Power Sector 9 9.2. Load Management
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COST OVERRUN FACTORS AND PROJECT COST RISK ASSESSMENT IN CONSTRUCTION INDUSTRY - A STATE OF THE ART REVIEW SAVITA SHARMA 1 & PRADEEP K. GOYAL 2 1 Senior Lecturer‚ Department of Civil Engineering‚ Govt. Polytechnic College‚ Ajmer‚ Rajasthan‚ India 2 Associate Professor‚ Department of Civil Engineering‚ Govt. Engineering College‚ Ajmer‚ Rajasthan‚ India ABSTRACT This paper presents a state of the art review of major and frequently occurred cost overrun factors and project cost risk assessment
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consists of: A. all manufacturing costs. B. indirect materials but not indirect labor. C. all manufacturing costs‚ except direct materials and direct labor. D. indirect labor but not indirect materials. 2. A variable cost is a cost whose cost per unit varies as the activity level rises and falls. A. True B. False 3. The traditional format income statement is used as an internal planning and decision-making tool. Its emphasis on cost behavior aids cost-volume-profit analysis‚ management
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Assignment 2: Costs and Profit (20 points) In Section 2‚ you learned about costs and profit. Now‚ you’ll apply what you learned. 1. Choose a real or made up example of a company‚ and describe at least three variable costs the company has. (1-3 sentences. 1.5 points) soaring angels attire company’s first variable cost is shirts they customize shirts to whatever you want them to be but how many shirts you want tells them how much material they need. Same thing with the shoes they also customize
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The historical cost accounting is an accounting technique that values an asset for balance sheet purposes at the price paid for the asset at the time of its acquisition. It is usually used in combination with other measurement bases. For example‚ inventories are usually carried at the lower of cost and net realizable value‚ on the other hand marketable securities are usually carried at market value‚ and entities prefer to carry pension liabilities at their present value. The main advantage of using
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of the more basic concepts of economics. Scarcity needs trade-offs‚ and trade-offs result in an opportunity cost. While the cost of a good or service often is thought of in monetary terms‚ the opportunity cost of a decision is based on what must be given up as a result of the decision. Any decision that involves a choice between two or more options has an opportunity cost. Opportunity cost‚ scarcity and trade-off are important in our daily life because it affects us every day in different ways and
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Overview Welcome to the study of cost accounting. This introductory chapter explains the intertwining roles of managers and management accountants in choosing an organization’s strategy‚ and in planning and controlling its operations. Unlike the remainder of the textbook‚ this chapter has no “number crunching.” Its main purpose is to emphasize the management accountant’s role in providing information for managers. Review Points organization. Cost accounting provides information
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