0
What else can I help you with?
If marginal revenue is greater than marginal cost the firm should?
If MR is greater than MC, the firm should increase their production. The ideal amount of production is determined by allowing the marginal cost to equal the marginal revenue.
Explain the factors detemimining working capital requirements of a firm?
The nature of the business, seasonality of production and the production cycles are some of the factors that determine the working capital requirements of a firm.
Which cost amounts can be found in a firm's accounting records?
sunk cost
Difference between imputed and implicit cost?
According to the "Bible" for accounting terminology, Barron's Dictionary of Accounting Terms, 5th Edition, they are the same. In fact, when you look up implicit cost, it refers you to imputed cost. This is the definition of imputed cost: "A cost that is implied but not reflected in the financial reports of the firm: also called implicit cost. Imputed costs consist of opportunity costs of time and capital that the manage has invested in producing the given quantity of production and the opportunity costs of making a particular choice among the alternatives being considered."
Is it true that Retained earnings have no cost to the firm?
Yes
What is the relationship between marginal revenue and marginal cost in determining the optimal level of production for a firm?
The relationship between marginal revenue and marginal cost in determining the optimal level of production for a firm is that the firm should produce at a level where marginal revenue equals marginal cost. This is because at this point, the firm maximizes its profits by balancing the additional revenue gained from producing one more unit with the additional cost of producing that unit.
What is the significance of the price equaling marginal cost in determining the optimal level of production for a firm?
When the price equals the marginal cost, it indicates that the firm is producing at an optimal level where the cost of producing one more unit is equal to the revenue gained from selling that unit. This helps the firm maximize its profits and operate efficiently.
Which of the ollowig are included in a typical firm's production cost?
rent or real
Explain why a firm needs to know its short run production function to be able to calculate the costs of production?
In the fhort-run production, a firm can produce and various its quantities of inputs to maximize its profit in a period of time frame. Variable cost, fixed cost, total average cost, marginal cost ....profit.
What is the relationship between the average cost curve and the production costs of a firm?
The average cost curve shows the average cost per unit of production for a firm. It is derived from the total cost curve, which represents the total cost of production at different levels of output. The average cost curve is U-shaped, indicating that as production increases, average costs initially decrease due to economies of scale, then increase due to diminishing returns. The relationship between the average cost curve and production costs is that the average cost curve reflects how efficiently a firm is producing goods or services in relation to its total costs.
What is the difference between returns to scale and economies of scale in terms of their impact on a firm's production efficiency and cost structure?
Returns to scale refer to the change in output when all inputs are increased proportionally, while economies of scale refer to the cost advantages a firm gains as it increases its production levels. Returns to scale can impact a firm's production efficiency by affecting the overall output, while economies of scale can impact a firm's cost structure by reducing the average cost per unit as production increases.
What happens if marginal cost is equal to average total cost?
When marginal cost is equal to average total cost, it means that the cost of producing one more unit is the same as the average cost of all units produced. This indicates that the firm is operating at its most efficient level of production.
What is large scale of production?
When a business or a firm produce large amount of production, then it is called large scale of production.
If marginal revenue is greater than marginal cost the firm should?
If MR is greater than MC, the firm should increase their production. The ideal amount of production is determined by allowing the marginal cost to equal the marginal revenue.
Will a firm that owns its own capital equipment will have the exact same long run cost function as a firm that rents capital if both firms have the same production function?
No a firm that owns its own capital equipment will not have the exact long run cost function as a firm that rents capital even if they both have the same production function.
When a firm produces a level of output on the production function?
Marginal physical product is zero
What should the firm do if marginal revenue is greater than marginal cost?
If a firm's marginal revenue is greater than its marginal cost, it should increase production to maximize profits.
