If Gorgeous Sands Resort has a constant marginal cost of $20,000 for each resort unit and a constant marginal cost of $500 for operating each resort unit, what is Gorgeous Sands Resort's long-run marginal cost per resort unit?
A) $19,500 B) $20,500 C) $500 D) $20,000
B) $20,500
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Refer to Figure 3-6. The figure above represents the market for canvas tote bags. Assume that the market price is $35. Which of the following statements is true?
A) There is a surplus that will cause the price to decrease; quantity demanded will then increase and quantity supplied will decrease until the price equals $25. B) There is a surplus that will cause the price to increase; quantity demanded will then decrease and quantity supplied will increase until the price equals $25. C) There is a surplus that will cause the price to decrease; quantity supplied will then increase and quantity demanded will decrease until the price equals $25. D) There will be a surplus that will cause the price to decrease; demand will then increase and supply will decrease until the price equals $25.
Refer to Figure 13-13. If the diagram represents a typical firm in the market, what is likely to happen to its average cost of production in the long run?
A) It will probably fall since the firm must be cost efficient to remain competitive. B) It will probably rise since the firm will be producing less than its current amount. C) It will probably rise since its long-run demand is likely to be higher. D) It will probably fall since the firm will be selling less than its current amount.
A common mistake made by consumers is the failure to take into account the sunk costs of their actions
Indicate whether the statement is true or false
Refer to Figure 11-15. Suppose Hilda hires labor at $8 per hour and capital costs $10 per unit. What is the minimum cost of producing 200 gooseberry pies?
A) $3,600 B) $1,120 C) $592 D) $560