You Are a Manager in a Perfectly Competitive Market

question 64

Multiple Choice

You are a manager in a perfectly competitive market.The price is $14.Your total cost curve is C(Q) = 10 + 4Q + 0.5Q².What level of output should you produce in the short run?

• A) 5
• B) 8
• C) 10
• D) 15

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Definitions:

Standard Costs

Predetermined costs for materials, labor, and overhead used as targets for controlling production costs.

Direct Materials Price Variance

The difference between the actual cost and the standard cost of direct materials used in production.

Standard Materials Quantity

The estimated amount of materials expected to be used in the production of a product under normal operating conditions.

Board Feet

A unit of measure for lumber, representing a volume of 144 cubic inches, equivalent to a board that is one foot long, one foot wide, and one inch thick.