Provide an Example of a Numeric and Non-Numeric Project Selection

question 80

Essay

Provide an example of a numeric and non-numeric project selection model and indicate what advantage each might hold over the other.

---

Definitions:

ATC

Stands for Average Total Cost, which is the total cost of production (fixed plus variable costs) divided by the number of units produced.

Economic Profits

A reiteration emphasizing the calculation that includes total revenues minus total costs, where total costs consider both the explicit and implicit costs.

Competitive Price-searcher Market

A market structure where firms have some degree of market power, enabling them to set prices above marginal cost, but must consider competitor prices to attract consumers.