ECO 401 Assignment # 2 solution

[alliens]

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Assignment # 2
Economics (ECO401)

Question A:
Calculate average cost and average revenue of GN for each year?
Answer A:
AC (TC/Q) AR(TR/Q)
216 350
241 425
296 510
450 630
960 720
2750 1000

Formulas for calculation:
Average Cost = TC/Q
32000/148= 216
35000/145= 241
40000/135= 296
45000/100= 450
48000/50= 960
55000/20= 2750

Total Revenue = P × Qs
350 × 148 = 51800
425 × 145 = 61625
510 × 135 = 68850
630 × 100 = 63000
720 × 50 = 36000
1000 × 20 = 20000

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Average Revenue = TR/Q
51800/148= 350
61625/145= 425
68850/135= 510
63000/100= 630
36000/50= 720
20000/20= 1000
Question B:
Calculate at each level whether GN is operating at profit or loss?
Answer B:
TR Tπ=TR-TC
51800 51800-32000= 19800
61625 61625-35000= 26625
68850 68850-40000= 28850
63000 63000-45000= 18000
36000 36000-48000= -12000
20000 20000-55000= -35000

Question C:
Determine the quantity sold and price level at which the total profit for GN is maximized?

Answer C:
The total profit for GN is maximized in the year 2009 where the profit is 28850. which is maximum. The profit is maximum where the difference between the total profit and total cost is greater.
Question D:
As a student of Economics, analyze how this incident will affect the over all automobile industry?
Answer D:
First of all the ban on the production will lead to the higher in price of the automobiles and the relevant material use in the production of it. In this period the company will get its maximum profit. Than the gas prices also raise due to the shortage of the CNG. After some time the cost of the production will greater than the revenue because the people move towards the alternative resources. Due to this shift this automobiles industry will not able to cover its basic cost and if this ban will continues than this automobiles industry will completely shutdown.

[rabeel]

yah solution app ko kahan say mila hai g?

[Fizz jee]

assingment ka solution q ni upload kia ap ny

[Vuhelper]

Part A 	Part B
AC 	AR 	TR 	Profit/Loss
216.22 	350 	51800 	19800
241.38 	425 	61625 	26625
296.30 	510 	68850 	28850
450 	630 	63000 	18000
960 	720 	36000 	-12000
2750 	1000 	20000 	-35000

We know that AC= TC/Q

TR= PxQ

AR =TR/Q

Now Profit/Loss= TR-TC

According to this approach, profit is maximized at that point where the difference between total revenue & total cost is maximum.

Now Profit is maximized at 28850 because difference between TR and TC is maximum

[Vuhelper]

eco401 full solution