Solve the Problem
-The Cost in Millions of Dollars for a Company

question 219

Multiple Choice

Solve the problem
-The cost in millions of dollars for a company to manufacture $x$ thousand automobiles is given by the function $C ( x ) = 4 x ^ { 2 } - 32 x + 128$ . Find the number of automobiles that must be produced to minimize the cost.

• A) 8 thousand automobiles
• B) 16 thousand automobiles
• C) 64 thousand automobiles
• D) 4 thousand automobiles

Recognize the role of asymmetric information in designing contracts and transactions.

Outline the impact of various incentive structures on adverse selection and moral hazard.

Distinguish between different types of economic mechanisms and their applications in real-world scenarios.

Appreciate the use of signal theory in labor markets and various forms of market signaling.

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Definitions:

Sunk Cost

Costs that have already been incurred and cannot be recovered or changed.

Alternative

An option or choice among several available in a given situation, often considered when making decisions.

Relevant Range

The span of activity or volume over which the specific assumptions of cost behavior hold true, often considered in budgeting and decision-making.

Mixed Costs

Expenses that contain both fixed and variable components, changing in total with the level of activity but not directly proportional.