Project #21835 - Microeconomics

ECON212-1401A-06 Principles of Microeconomics
Task Name: Phase 3 Individual Project
Deliverable Length: 800–1,000 words plus table
Details:

Weekly tasks or assignments (Individual or Group Projects) will be due by Monday and late submissions will be assigned a late penalty in accordance with the late penalty policy found in the syllabus. NOTE: All submission posting times are based on midnight Central Time.

You are the owner of a small bread factory and are thinking of lowering costs and expanding. Your small-business advisors suggested that you first review your operations and make some technological changes. Complete the following:

  • Explain what a technological change is and how you can use it to lower your costs.

The next thing that your small business advisors asked you to do was to break down your costs and see what you can reduce.

  • Develop a table that you believe shows the explicit fixed costs of the bread factory and the total amount of the costs.
  • Describe your variable costs.
  • Because you are not an expert yet on analyzing costs and optimal production levels, you decide to do a very simple analysis of your short-run fixed and variable costs if you expand. You decide that your only fixed cost will be the ovens and the variable costs will be the workers.

Quantity of Workers

Quantity of Ovens

Quantity of Loaves of Bread Produced

Cost of Ovens

Cost of Workers Per Week

0

2

0

500

0

1

2

50

 

450

2

2

125

 

 

3

2

210

 

 

4

2

300

 

 

5

2

410

 

 

6

2

550

 

 

7

2

625

 

 

8

2

660

 

 

9

2

700

 

 

10

2

730

 

 


Instructions
 
  1. Calculate the  total cost and the average total cost, and add it to the table
  2. Calculate the marginal product of labor, and add it to the table.
  3. Calculate the average product of labor, and add it to the table.
  4. Although there seems to be a great demand for your bread, why would productivity decline when you hire more labor in the short run?
  5. What are your marginal costs?
  6. At what point do your marginal costs and your total costs intersect?
  7. Calculate your average total costs, your average fixed costs, and your average variable costs.
  8. What happens to your average variable costs as your output goes up? Why is that?
  9. How would expanding the business affect the economies of scale? When would you have constant return to scale and diseconomies of scale? Provide examples.
  10. Where is the optimal level of production and the optimal level of prices in the short run?

Please submit your assignment.

Click on Student Expectations to view the expectations for this assignment.

Assignment Grading Rubric

For assistance with your assignment, please use your text, Web resources, and all course materials.

Course Materials

Course Materials

Points Possible: 100
Date Due: Monday, Jan 27, 2014
Objective:
  • Utilize the tools of economics for decision making for a firm operating in a market economy
  • Discuss the impact of current economic trends and realities on politics, the workplace and the quality of individual lives.
Submitted Files: Submit Task
Score: 0
Instructor Comments: No comments have been made

Subject Business
Due By (Pacific Time) 02/02/2014 12:00 pm
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