Economics Assignment: Economics for Managers

Added on - 28 May 2020

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qwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmrtyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwertyuiopasdfghjklzxcvbnmqwEconomics for Managers[Type the document subtitle][Pick the date]Com
ContentsQuestion 1...................................................................................................................................................3Question 2...................................................................................................................................................4Question 3...................................................................................................................................................5Question 4...................................................................................................................................................6Question 5...................................................................................................................................................7Question 6...................................................................................................................................................8Question 7...................................................................................................................................................9Bibliography................................................................................................................................................9
Question 1The costs of Production line are fixed while the costs of labour can be changed.(It is assumedthe factory produces at a the lowest minimum cost currently. ) Assuming that labour is the onlyvariable cost here,MC = Cl..Cl..= Cost of Labour per unit of cards producedTotal Cost of Production isTC= Ck+ 100,000Cl..CK= Total Cost per Unit of the capital Used (Capital = Production line Costs)It is generally, assumed that , in the Short run, the capital is fixed and cannot change. It is thelabour costs that are variable. Hence, the total change in costs will be the Labour Costs. Giventhat the labour has to be paid a time and half, new Marginal cost will be:MC =1.5Cl..The Total Costs will beTC = Ck+ (1.5ClX 150,000)Total cost =Ck+ 225,000 ClThe change in costs is 125,000 CLfor 50,000 units. Hence, the change in cost per unit is 2.5 Cl.In order to maximize profits, Marginal Revenue (Price) should equal Marginal Costs.[ CITATIONCha09 \l 1033 ]Hence, the price should increase by 2.5 CL.
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