Economia

Yamillet Rivera Santos
S00437376
Asignación Semana 6

Chapter 9

Technical Problems

2.

a. K= 60 – 3/ 4L
$37.50
$3,000

b. 40
30
$3,000
60 – ¾ (40) = 59.981

c. 90
120K= 90 – 3/4L
60

7. First we have to calculate exercise 6

Q | L | K | LTC | LAC | LMC |
10 | 64 | 24 | 4,000 | 400 | 400 |
20 | 140 | 40 | 7,500 | 375 | 350 |
30 | 200 | 58 | 10,800 |360 | 330 |
40 | 288 | 80 | 15,200 | 380 | 440 |
50 | 460 | 90 | 20,500 | 410 | 530 |

Economies of scale exist for 0 to 30 units of outputs, there are diseconomies of scale for 30 to 50 unitsof output.

Applied Problems

4.

a.
Daily output of one machine = 1800 units
Daily output of one labor = 200 units

Clearly output of one machine is 9 times the output of a labor. So,one machine can replace 9 workers.
Reduction in labor bill = $50*9=$450.
Increase in daily cost due to one machine =price of textile machine for one day= $600 per day

That machine willincrease daily costs by $600 while the savings are only $450 per day. So, management cannot reduce the cost of assembling 5,400 units per day by purchasing the textile machines and using less labor.

b.Daily output of one machine = 1800 units
Daily output of one labor = 200 units

Clearly output of one machine is 9 times the output of a labor. So, one machine can replace 9 workers.Reduction in labor bill = $100*9=$900.
Increase in daily cost due to one machine =price of textile machine for one day= $600 per day

Since increase in the cost of the machine is $600 per day while thesavings are $900 per day, management would reduce the cost by purchasing the textile machines.

6.

a. Spreading the overhead" refers to this declining value of AFC as more and more Output (Q) isproduced.

b. Break-even analysis is a useful tool to study the relationship between fixed costs, variable costs and returns. A break-even point defines when an investment will generate a...