Gce Model Questions Vol1 2022 Economics Question 17

Practice objective / multiple choice question 17 from the 2022 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2022 Economics Objective / Multiple Choice Hard Difficulty
Question 17 GCE_MODEL_QUESTIONS_VOL1 • 2022 • ECONOMICS • objective

A manufacturing firm has total cost \(TC = 1000 + 20Q + 0.05Q^{2}\). The market price is £30 per unit.\n(a) Find the output at which average total cost (ATC) is minimised.\n(b) Calculate that minimum ATC.\n(c) Should the firm produce in the short‑run? State the profit or loss at the output found in (a).

Answer Options

A. Output ≈ 150 units; Minimum ATC ≈ £33.00; Firm should produce; Expected loss ≈ £450.0
B. Output ≈ 141.4 units; Minimum ATC ≈ £30.00; Firm should produce; Expected loss ≈ £0.0
Correct Answer C. Output ≈ 141.4 units; Minimum ATC ≈ £34.14; Firm should shut down; Expected loss ≈ £585.5
D. Output ≈ 100 units; Minimum ATC ≈ £35.00; Firm should shut down; Expected loss ≈ £500.0
Correct Answer
C
Correct Option:
Output ≈ 141.4 units; Minimum ATC ≈ £34.14; Firm should shut down; Expected loss ≈ £585.5

About This Question

This is Gce Model Questions Vol1 2022 Economics Question 17. It is one of the objective questions from the 2022 Gce Model Questions Vol1 Economics examination.

Difficulty level: Hard .

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