29 You are given the following data concerning the production costs and the average revenue of a profit maximising firm that produces Good X. The fixed costs of production are £100. Output of Short Run Average Average Revenue Good X Variable Cost (£s) (£s) 1 110 300 2 95 250 3 80 210 4 75 180 5 82 150 6 85 120 7 90 100 8 100 90 9 110 80 10 120 70 (i) Calculate the profit maximising output of the firm. [1] (ii) State the level of output at which average total costs are minimised. [1] (iii) State what will happen to the production in the short run if the fixed costs of production rise from £100 to £400. [1] (iv) Calculate the smallest rise in total variable costs (to the nearest pound) that would force the firm to cease production in the short run. [2] May I know if i could get the full solution(steps included) of this question ?
What is the combined effect of an increase in the cost of production and a rise in consumer income on the equilibrium price and quantity of a normal good? A The effect on price is indeterminate but quantity will fall. B The effect on price is indeterminate but quantity will rise. C The effect on quantity is indeterminate but price will rise. D The effect on quantity is indeterminate but price will fall. May I know why this question ,the answer is C ? Is there any graph to prove ?
25 Given the following labour hours required to produce 1 unit of each of Goods X and Y, which one of the statements below is TRUE? Country Good X Good Y A 8 10 B 10 20 A Country A has a comparative advantage and an absolute advantage in producing Good Y. B Country B has a comparative advantage in producing Good X and an absolute advantage in producing Good Y. C Country A has a comparative advantage in producing Good X and an absolute advantage in producing Good Y. D Country B has a comparative advantage in producing Good Y and an absolute advantage in producing Good X. Personally i think that the answer for this is B? as Country A should nt be hvg any absolute advantage ?
