Ch. 6 Managerial Econ

Karmyn Hawley Managerial Economics Dr. Saffarian 04/18/2023 Ch. 6 Homework 1.5 I think I would be more likely to try and go to this hockey game if I had bought the ticket. If I had bought the ticket instead of winning it, I would be out the money I had paid for the ticket (my sunken cost). Winning the ticket afforded me the opportunity cost of getting to go to the hockey game for free. I didn't have to pay financially for the ticket, but my time spent at the hockey game gave me an opportunity cost. Not going to the game, because of the snowstorm, has costed me both the sunken cost as well as the opportunity cost. 2.4 a) C = 10 + 10Q FC = 10 AFC = 10/Q MC = 10 AVC = 10 AC = 10/Q + 10 b) C = 10 + Q^2 FC = 10 AFC =10/Q MC = 2Q
AVC = Q AC = 10/Q + Q c) C=10+10q-4q^2=q^3 2.9 Production function= q = 2L^0.5K^0.5 Wage rate w= 20 and r = 40 Cost = 20L+40K In short run Capital is fixed at K= 100. So short-run production function: q = 2L^0.5 100^0.5 q = 20L^0.5 L = q^2/400 Now short-run total cost = short-run variable cost +short run fixed cost STC= 20L+40X100 STC= 20q^2/400+4000 STC= q^2/20+4000 This represents the short-run total cost of the firm. Short-run variable cost = q^2/20 and short-run fixed cost is 4000 Now, short-run average fixed cost: SAFC=4000/q Short-run average variable cost (SAVC): q/20 Short-run marginal cost: dSTC/dq=2q/20+0 SMC=q/10
Uploaded by BailiffEagle3681 on