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When a firm produces a level of output on the production function?
Marginal physical product is zero
Is economic profit a cost of production?
Economic profits are not costs of production since the entrepreneur does not require the gaining of an economic profit to keep the firm operating. In economics, costs are whatever is required to keep a firm operating.
Why can firms not always reduce prices until they increase sales and profits?
if marginal production costs exceed marginal revenues, the firm will suffer losses, not profits.
What is a production period that allows changes only in variable inputs?
This production period is called the short run production period. This means that the amount of capital in the firm is fixed and cannot change because it takes time for the firm to receive ordered capital. In this situation the firm must change labor and materials (variable inputs) in order to maximize profits. The opposite of the short run production period is the long run production period. In the long run all inputs are flexible and the firm can theoretically maximize profits at any level of capital.
Importance of mobility of factors of production?
emphasise on efficiency of production in a firm
The cost of a firm that vary with the level of production are called?
variable cost
How do you calculate expected sales?
A firm has made the following estimates of next year's sales: Probability Sales 20% R200 000 60% R240 000 20% R260 000 The firm should use an expected sales level of..................for budgeting purposes.
When a firm produces a level of output on the production function?
Marginal physical product is zero
When a firm utilizing FIFO inventory accounting what would the calculating gross profits assume that?
sales were from beginning inventory until it was depleted, and then use sales from current production
If the firm's sales revenue income exceeds its expenses the firm has earned a profit?
If a firm's sales revenue exceeds its expenses, the firm has earned a profit.
Is economic profit a cost of production?
Economic profits are not costs of production since the entrepreneur does not require the gaining of an economic profit to keep the firm operating. In economics, costs are whatever is required to keep a firm operating.
Why can firms not always reduce prices until they increase sales and profits?
if marginal production costs exceed marginal revenues, the firm will suffer losses, not profits.
What is a production period that allows changes only in variable inputs?
This production period is called the short run production period. This means that the amount of capital in the firm is fixed and cannot change because it takes time for the firm to receive ordered capital. In this situation the firm must change labor and materials (variable inputs) in order to maximize profits. The opposite of the short run production period is the long run production period. In the long run all inputs are flexible and the firm can theoretically maximize profits at any level of capital.
A firm has beginning inventory of 300 units at a cost of 11 each Production during the period was 650 units at 12 each If sales were 700 units what is the cost of goods sold assume FIFO?
a firm has beginning inventory of 300 units at a cost of 11 each. production during the period was 650 units at 12 each. if sales were 700 units what is the cost of goods sold (assume FIFO)
What is a sales firm?
A sales firm is a company whose major purpose is to sell things. Companies in this field often contract with manufacturers to sell the makers goods. For instance, a new car dealer is a sales firm where as the company that makes the cars is not.
Importance of mobility of factors of production?
emphasise on efficiency of production in a firm
What is the production function and types of production function?
production function is relation between firm's production and material factors of production
