SR Cost Problem – vc F2F
General instructions are as follows. Open a word processing program, such as MS WORD. Open a new document. Copy and paste this document into that new document. Follow the instructions for each part below. Insert answers in the spaces provided. Submit a copy before class on the date due, and make a copy to refer to as the h/w is discussed in class.
Consider a manufacturing firm operating a given scale of plant. Assume that the only input that the firm can change the amount of that can be used during the time period considered is labor (L).
Assume that the production function between Labor (L) and Total Product (Q) is given in the first two columns of the table below.
Labor (L) Total Product (Q) Labor (L) Total Product (Q)
1 100 10 1,234
2 250 11 1,314
3 410 12 1,384
4 560 13 1,444
5 700 14 1,494
6 830 15 1,534
7 945 16 1,564
8 1,050 17 1,584
9 1,146 18 1,594
Assume that depreciation on the plant and equipment, interest on borrowed money, property taxes, insurance, etc., i.e., Total Fixed Costs (TFC), are $220, and that the price of a unit of labor (PL) is $100.
To gain experience with a valuable piece of business software, it is strongly suggested that the student use a spreadsheet software program to perform the calculations and to construct the graphs described in parts A and B below. Any spreadsheet program may be used although students may be most familiar with MS EXCEL. It is assumed that the student is familiar with making calculations using a spreadsheet program.
As indicated on the course Syllabus, it is suggested that MS OFFICE, which includes EXCEL, be installed on external computers that are used. It is installed on all the computers located on the Gannon main campus.
Instructions. Open a spreadsheet program, such as MS EXCEL. Open a new worksheet. Enter the above data for L in column 1 and the above data...