Author Question: Relationship between Short and Long Run Average CostsThe table shows information about Umbrella ... (Read 59 times)

llesku · **on:** Nov 23, 2022

Question 1

Interpreting the Shape of Cost Curves

Use the information in the graph to find costs at an output level of Q1=300.

If C1=$2.50, C2=$7.50, and C3=$14.50, what is marginal cost? What is total cost? What is total variable cost? What is total fixed cost?
◦ $750, $14.50, $7.50, $7.00
◦ $2.50, $14.50, $7.50, $7.00
◦ $2.50, $4350, $2250, $2100
◦ $750, $4350, $2250, $2100

Question 2

Relationship between Short and Long Run Average Costs

The table shows information about Umbrella Corporation's short-run costs.

Quantity of Prescription Drugs	Total Fixed Cost	Total Variable Cost	Total Cost
0	$4000
1		$7
2		$14
3		$21
4			$4028

What is the average fixed cost of producing 4 prescription drugs? What is the average variable cost?
What is the average total cost of producing 2 prescription drugs? What is the marginal cost?
◦ $2000, $7, $2007, $2000
◦ $2000, $21, $2007, $2000
◦ $1000, $7, $2007, $2000
◦ $1000, $7, $2007, $7

bainer89 · **Reply #1 on:** Nov 23, 2022

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