Exercise 2 Inventory Management. Teresa Grilo Dep. of Engineering and Management Instituto Superior Técnico Lisbon, Portugal
|
|
|
- Jennifer Harris
- 5 years ago
- Views:
Transcription
1 Exercise 2 Inventory Management Teresa Grilo Dep. of Engineering and Management Instituto Superior Técnico Lisbon, Portugal SCM/IST 1 SCM/IST IST Lisbon IST Lisbon Ana Ana Póvoa, Póvoa, Ana Carvalho Ana Carvalho
2 Introduction Single Period Model One ordering opportunity only Order quantity to be decided before demand occurs Order Quantity > Demand => Dispose excess inventory Order Quantity < Demand => Lose sales/profits 2 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
3 Introduction Using historical data: identify a variety of demand scenarios determine probability that each of these scenarios will occur Given a specific inventory policy: determine the profit associated with a particular scenario weight each scenario s profit by the likelihood that it will occur determine the average, or expected, profit for a particular ordering quantity. Order the quantity that maximizes the average profit. 3 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
4 Problem Christmas ornaments Seasonal product Forecast based on company historical data from the last five years, current economic conditions and other factors 4 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
5 Problem Fixed cost of production is equal to ; Variable cost of production per unit is equal to 4 ; During Christmas time the selling price of an ornament is 10 ; Any ornament not sold during Christmas season is sold to a discount store for 2 (Salvage value). 5 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
6 Resolution a) a) Determine the optimal production quantity. Represent in a graph the variation of the profit versus the produced quantity (consider all the points of produced quantities between and , with an increment of between points). 6 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
7 Resolution a) 1. Fill out the table with forecasted demand and calculate the average demand. 2. Fill out the table with the costs. 7 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
8 Resolution a) 3. Calculate the profit for each combination of demandproduced quantity. Profit =? 8 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
9 Resolution a) 3. Calculate the profit for each combination of demandproduced quantity. Profit = Min (Demand; Production) x Selling Price + + Max (Production - Demand ; 0) x Salvage Value -VC x Production - FC 9 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
10 Discussion a) Optimal Quantity to Produce = units => Profit The average demand is units, so why is the optimal quantity to produce higher than the average? 10 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
11 Resolution b) b) If the variable cost is 7, what is the optimal production quantity? Can you take any conclusion regarding optimal production quantity and marginal profit and marginal cost? 1. Repeat again the previous steps using the variable cost of SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
12 Discussion b) Optimal Quantity to Produce = units => Profit But why the optimal quantity to produce is now lower than the average demand (9.300 units)? 12 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
13 Resolution b) 2. Calculate the marginal profit and the marginal loss. Marginal Profit = Selling Price Variable Cost Marginal Loss = Variable Cost Salvage Value 1. Variable Cost = 4 2. Variable Cost = 7 13 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
14 Discussion b) 1. Variable Cost = 4 Marginal Profit = 10 4 = 6 Marginal Cost = 4 2 = 2 MP > MC => OQP > Average 2. Variable Cost = 7 Marginal Profit = 10 7 = 3 Marginal Cost = 7 2 = 5 MC > MP => OQP < Average 14 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
15 Resolution c) c) Company has still some remains from the previous year, 4000 units. Managers are considering not producing any units. Do you think this is the best option? If not, how many units would you produce? And if you have 8000 units in stock, do you have the same opinion? 1. Plot the curve of profit without taking into account the fix costs. 2. Determine the profit for the two scenarios: Scenario 1: No production Scenario 2: Production of items until reach the optimal value 15 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
16 Discussion c) Profit (No production) = Profit (Blue Line) + Variable Cost (Initial Inventory) Profit (Production) = Profit (Red Line) + Variable Cost (Initial Inventory) 16 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
17 Discussion c) Initial Inventory = units Profit ( ) Units to Sell Units to Produce No Production Production Initial Inventory = units Profit ( ) Units to Sell Units to Produce No Production Production SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
18 Discussion c) Initial Inventory = units Profit ( ) Units to Sell Units to Produce No Production Production Initial Inventory = units Profit ( ) Units to Sell Units to Produce No Production Production SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
19 Conclusions Single period models (one chance of ordering) are based on forecasts. Forecats are always wrong, so use different scenarios to evaluate profit; and produce the amout that optimizes the profit. Marginal Profit and Marginal Loss influence the production decision: When MP > MC => OQP > Average Demand When MC > MP => OQP < Average Demand When initial inventory exists, evaluate if it is worth to produce more units or not (Fix costs). 19 SCM/IST IST Lisbon Ana Póvoa, Ana Carvalho 2015
X 410 Business Applications of Calculus
X 410 Business Applications of Calculus PROBLEM SET 1 [100 points] PART I As manager of a particular product line, you have data available for the past 11 sales periods. This data associates your product
*** Your grade is based on your on-line answers. ***
Problem Set # 10: IDs 5000-6250 Costs of Production & Short-run Production Decisions Answer the questions below. Then log on to the course web site (http://faculty.tcu.edu/jlovett), go to Microeconomics,
THEORY OF COST. Cost: The sacrifice incurred whenever an exchange or transformation of resources takes place.
THEORY OF COST Glossary of New Terms Cost: The sacrifice incurred whenever an exchange or transformation of resources takes place. Sunk Cost: A cost incurred regardless of the alternative action chosen
2- Demand and Engel Curves derive from consumer optimal choice problem: = PL
Correction opics -he values of the utility function have no meaning. he only relevant property is how it orders the bundles. Utility is an ordinal measure rather than a cardinal one. herefore any positive
Marginal Product and Marginal Cost
Marginal Product and Marginal Cost 4. 3rd (decreases from 10, 15 to 11) 5. Greater than a higher MP will increase TP and thus increase APP 6. No, neither output or labor can be negative 7. Yes, if an additional
ECONOMICS 103. Topic 7: Producer Theory - costs and competition revisited
ECONOMICS 103 Topic 7: Producer Theory - costs and competition revisited (Supply theory details) Fixed versus variable factors; fixed versus variable costs. The long run versus the short run. Marginal
Economics II - Exercise Session, December 3, Suggested Solution
Economics II - Exercise Session, December 3, 008 - Suggested Solution Problem 1: A firm is on a competitive market, i.e. takes price of the output as given. Production function is given b f(x 1, x ) =
EE266 Homework 5 Solutions
EE, Spring 15-1 Professor S. Lall EE Homework 5 Solutions 1. A refined inventory model. In this problem we consider an inventory model that is more refined than the one you ve seen in the lectures. The
Econ 103 Lab 10. Topic 7. - Producer theory. - Brief review then group work on assigned. - iclicker questions in the last mins.
Econ 103 Lab 10 Topic 7. - Producer theory. - Brief review then group work on assigned - iclicker questions in the last 15-20 mins. 1 Cost curves Make sure you understand the u-shaped cost curves illustrated
For 466W Forest Resource Management Lab 5: Marginal Analysis of the Rotation Decision in Even-aged Stands February 11, 2004
For 466W Forest Resource Management Lab 5: Marginal Analysis of the Rotation Decision in Even-aged Stands February 11, 2004 You used the following equation in your first lab to calculate various measures
Chapter 7 Pricing with Market Power SOLUTIONS TO EXERCISES
Firms, Prices & Markets Timothy Van Zandt August 2012 Chapter 7 Pricing with Market Power SOLUTIONS TO EXERCISES Exercise 7.1. Suppose you produce minivans at a constant marginal cost of $15K and your
Chapter 8: Costs and the Changes at Firms Over Time Solutions to End-of-Chapter Problems
Chapter 8: Costs and the Changes at Firms Over Time Solutions to End-of-Chapter Problems 1. short run/long run These represent concepts that economists use to describe time. The short run is a period of
Chapter 7. The Cost of Production
Chapter 7 The Cost of Production Topics to be Discussed Measuring Cost: Which Costs Matter? Cost in the Short Run Cost in the Long Run Long-Run Versus Short-Run Cost Curves Production with Two Outputs:
Chapter 8. Profit Maximization and Competitive Supply. Perfectly Competitive Markets. Profit Maximization. Q: Decision Making of Ownermanaged
Chapter 8 Profit Maximization and Competitive upply Q: ecision Making of Ownermanaged usiness uppose you are running a small business. What is your objective? What are you supposed to decide? What is profit?
Input-Output Analysis Exercises
Input-Output Analysis Exercises Energy Management Class P9 João Rodrigues Instituto Superior Técnico Lisbon, Portugal joao.rodrigues@ist.utl.pt 8 and November 2 Review Input-Output Analysis is a tool primarily
Chapter 7. The Cost of Production. ΔVC Δq. ΔTC Δq. Fixed and Variable Costs. Fixed Cost Versus Sunk Cost. Measuring Costs
Chapter 7 The Cost of Production Fixed and Variable Costs Total output is a function of variable inputs and fixed inputs. Therefore, the total cost of production equals the fixed cost (the cost of the
Chapter 7. The Cost of Production. Fixed and Variable Costs. Fixed Cost Versus Sunk Cost
Chapter 7 The Cost of Production Fixed and Variable Costs Total output is a function of variable inputs and fixed inputs. Therefore, the total cost of production equals the fixed cost (the cost of the
Economics Introduction: A Scenario. The Revenue of a Competitive Firm. Characteristics of Perfect Competition
C H A T E R Firms in Competitive Markets E RINCILES OF Economics I N. Gregory Mankiw remium oweroint Slides by Ron Cronovich 009 South-Western, a part of Cengage Learning, all rights reserved In this chapter,
The Production Process and Costs. By Asst. Prof. Kessara Thanyalakpark, Ph.D.
The Production Process and Costs By Asst. Prof. Kessara Thanyalakpark, Ph.D. 1 Production Analysis Production Function Q = F(K,L) The maximum amount of output that can be produced with K units of capital
Microeconomics. Lecture Outline. Claudia Vogel. Winter Term 2009/2010. Part II Producers, Consumers, and Competitive Markets
Microeconomics Claudia Vogel EUV Winter Term 2009/2010 Claudia Vogel (EUV) Microeconomics Winter Term 2009/2010 1 / 36 Lecture Outline Part II Producers, Consumers, and Competitive Markets 7 Measuring
Behind the Supply Curve: Inputs and Costs
chapter: 12 >> Behind the Supply Curve: Inputs and Costs The following materials are taken from Chap. 12 of Economics, 2 nd ed., Krugman and Wells(2009), Worth Palgrave MaCmillan. 2009 Worth Publishers
Lecture 28.April 2008 Microeconomics Esther Kalkbrenner:
Lecture 28.April 2008 Microeconomics Esther Kalkbrenner: Supply and Demand Familiar Concepts Supply and Demand (Chapter 2) Applying the Supply and Demand Model (Chapter 3) Consumers Choice Consumer Choice
0 $50 $0 $5 $-5 $50 $35 1 $50 $50 $40 $10 $50 $15 2 $50 $100 $55 $45 $50 $35 3 $50 $150 $90 $60 $50 $55 4 $50 $200 $145 $55 $65
I. From Seminar Slides: 1. Output Price Total Marginal Total Marginal Profit Revenue Revenue Cost Cost 0 $50 $0 $5 $-5 1 $50 $50 $40 $10 $50 $15 2 $50 $100 $55 $45 3 $50 $150 $90 $60 $50 $55 4 $50 $200
Costs. Lecture 5. August Reading: Perlo Chapter 7 1 / 63
Costs Lecture 5 Reading: Perlo Chapter 7 August 2015 1 / 63 Introduction Last lecture, we discussed how rms turn inputs into outputs. But exactly how much will a rm wish to produce? 2 / 63 Introduction
Econ 110: Introduction to Economic Theory. 11th Class 2/14/11
Econ 110: Introduction to Economic Theory 11th Class 2/1/11 do the love song for economists in honor of valentines day (couldn t get it to load fast enough for class, but feel free to enjoy it on your
Solution to Sample Quiz 2
Solution to Sample uiz 2 ENVIRN 805K November 16, 2017 1. When there is no correction for the externality, P s = MP C = 2 +. Let P d = P s, we have e = 11 and P e = 13. In terms of the social optimum,
The Costs of Production
The of Production P R I N C I P L E S O F ECONOMICS FOURTH EDITION N. GREGORY MANKIW PowerPoint Slides by Ron Cronovich 6 Thomson South-Western, all rights reserved A C T I V E L E A R N I N G : Brainstorming
The Markets for the Factors of Production. In this chapter, look for the answers to these questions: Factors of Production and Factor Markets
18 The Markets for the Factors of Production P R I N C I P E S O F ECONOMICS FOURTH EDITION N. GREGORY MANKI Premium PowerPoint Slides by Ron Cronovich 28 update 28 South-estern, a part of Cengage earning,
Economics 101 Spring 2001 Section 4 - Hallam Problem Set #8
Economics 101 Spring 2001 Section 4 - Hallam Problem Set #8 Due date: April 11, 2001 1. Choose 3 of the 11 markets listed below. To what extent do they satisfy the 7 conditions for perfect competition?
Economics. Firms in Competitive Markets 11/29/2013. Introduction: A Scenario. The Big Picture. Competitive Market Experiment
N. Gregory Mankiw rinciples of Economics Sixth Edition Firms in Competitive Markets Modified by Joseph Tao-yi Wang remium oweroint Slides by Ron Cronovich The Big icture Chapter : The cost of production
UNIT 6. Pricing under different market structures. Perfect Competition
UNIT 6 ricing under different market structures erfect Competition Market Structure erfect Competition ure Monopoly Monopolistic Competition Oligopoly Duopoly Monopoly The further right on the scale, the
Chapter 021 Credit and Inventory Management
Multiple Choice Questions 1. The conditions under which a firm sells its goods and services for cash or credit are called the: A. terms of sale. b. credit analysis. c. collection policy. d. payables policy.
Firms in Competitive Markets. Chapter 14
Firms in Competitive Markets Chapter 14 The Meaning of Competition u A perfectly competitive market has the following characteristics: u There are many buyers and sellers in the market. u The goods offered
National marketing year average price less than the $3.70 Reference Price. Suppose a farmer is eligible what triggers a corn County ARC Payment?
AAE 320 Fall 2014 Final Exam Name: KEY 1) (20 pts. total, 2 pts. each) True or False? Mark your answer. a) T F_X_ Wisconsin s cranberry industry maybe important in the U.S., but production in Canada far
The Big Picture. Introduction: A Scenario. The Revenue of a Competitive Firm. Firms in Competitive Markets
Firms in Competitive Markets R I N C I L E S O F ECONOMICS F O U R T H E D I T I O N N. G R E G O R Y M A N K I W remium oweroint Slides by Ron Cronovich 8 update Modified by Joseph Tao-yi Wang 8 South-Western,
The Costs of Production
C H A P T E R The Costs of Production Economics P R I N C I P L E S O F N. Gregory Mankiw Premium PowerPoint Slides by Vance Ginn & Ron Cronovich 2009 South-Western, a part of Cengage Learning, all rights
The Costs of Production
The Costs of Production The Costs of Production The Law of Supply: Firms are willing to produce and sell a greater quantity of a good when the price of the good is high. This results in a supply curve
Econ 323 Microeconomic Theory. Practice Exam 2 with Solutions
Econ 323 Microeconomic Theory Practice Exam 2 with Solutions Chapter 10, Question 1 Which of the following is not a condition for perfect competition? Firms a. take prices as given b. sell a standardized
A Perfectly Competitive Market. A perfectly competitive market is one in which economic forces operate unimpeded.
Perfect Competition A Perfectly Competitive Market A perfectly competitive market is one in which economic forces operate unimpeded. A Perfectly Competitive Market A perfectly competitive market must meet
Econ 323 Microeconomic Theory. Chapter 10, Question 1
Econ 323 Microeconomic Theory Practice Exam 2 with Solutions Chapter 10, Question 1 Which of the following is not a condition for perfect competition? Firms a. take prices as given b. sell a standardized
Economics 101 Fall 2013 Homework 5 Due Thursday, November 21, 2013
Economics 101 Fall 2013 Homework 5 Due Thursday, November 21, 2013 Directions: The homework will be collected in a box before the lecture. Please place your name, TA name and section number on top of the
CPR-no: 14th January 2013 Managerial Economics Mid-term
Question 1: The market equilibrium can be found by setting demand = supply 20-0,00001Q D =5+0,000005Q S 15 =0,000015Q Q = 1000000 P= 20-0,00001*1000000 = 10 Question 2: The price equilibrium at this point
Quantitative Trading System For The E-mini S&P
AURORA PRO Aurora Pro Automated Trading System Aurora Pro v1.11 For TradeStation 9.1 August 2015 Quantitative Trading System For The E-mini S&P By Capital Evolution LLC Aurora Pro is a quantitative trading
Economics 335 Problem Set 6 Spring 1998
Economics 335 Problem Set 6 Spring 1998 February 17, 1999 1. Consider a monopolist with the following cost and demand functions: q ö D(p) ö 120 p C(q) ö 900 ø 0.5q 2 a. What is the marginal cost function?
Professor Christina Romer LECTURE 7 COMPETITIVE FIRMS IN THE LONG RUN FEBRUARY 6, 2018
Economics 2 Spring 2018 rofessor Christina Romer rofessor David Romer LECTURE 7 COMETITIVE FIRMS IN THE LONG RUN FEBRUARY 6, 2018 I. A LITTLE MORE ON SHORT-RUN ROFIT-MAXIMIZATION A. The condition for short-run
ECON 310 Fall 2005 Final Exam - Version A. Multiple Choice: (circle the letter of the best response; 3 points each) and x
ECON 30 Fall 005 Final Exam - Version A Name: Multiple Choice: (circle the letter of the best response; 3 points each) Mo has monotonic preferences for x and x Which of the changes described below could
Chapter 4. Consumer and Firm Behavior: The Work-Leisure Decision and Profit Maximization
Chapter 4 Consumer and Firm Behavior: The Work-Leisure Decision and Profit Maximization The Representative Consumer Preferences Goods: The Consumption Good and Leisure The Utility Function More Preferred
IV. THE FIRM AND THE MARKETPLACE
IV. THE FIRM AND THE MARKETPLACE A. The Firm's Objective 1. The firm is an institution that organizes production. a. The firm hires land, labor, capital and entrepreneurial ability in the factor markets.
Valuing Lead Time. Valuing Lead Time. Prof. Suzanne de Treville. 13th Annual QRM Conference 1/24
Valuing Lead Time Prof. Suzanne de Treville 13th Annual QRM Conference 1/24 How compelling is a 30% offshore cost differential? Comparing production to order to production to forecast with a long lead
Iteration. The Cake Eating Problem. Discount Factors
18 Value Function Iteration Lab Objective: Many questions have optimal answers that change over time. Sequential decision making problems are among this classification. In this lab you we learn how to
DEMAND AND SUPPLY ANALYSIS: THE FIRM
DEMAND AND SUPPLY ANALYSIS: THE FIRM 1 2. OBJECTIVES OF THE FIRM Profit = Total revenue Total cost Total Revenue: Amount received by a firm from sale of its output. Total Cost: Market value of the inputs
Unit 3: Costs of Production and Perfect Competition
Unit 3: Costs of Production and Perfect Competition 1 Inputs and Outputs To earn profit, firms must make products (output) Inputs are the resources used to make outputs. Input resources are also called
2. $ CHAPTER 10 - MONOPOLY. Answers to select-numbered problems: MC ATC P * Quantity
CHAPTER 10 - MONOPOLY Answers to select-numbered problems: 2. $ P * MC ATC MR D Q* Quantity The monopolist produces where marginal cost equals marginal revenue and charges P* dollars per unit. It makes
Introduction: A scenario. Firms in Competitive Markets. In this chapter, look for the answers to these questions:
14 Firms in Competitive Markets R I N C I L E S O F ECONOMICS FOURTH EDITION N. GREGORY MANKIW oweroint Slides by Ron Cronovich 2006 Thomson South-Western, all rights reserved In this chapter, look for
Measuring Cost: Which Costs Matter? (pp )
Measuring Cost: Which Costs Matter? (pp. 213-9) Some costs vary with output, while some remain the same no matter the amount of output Total cost can be divided into: 1. Fixed Cost (FC) Does not vary with
UNIT 5 DECISION MAKING
UNIT 5 DECISION MAKING This unit: UNDER UNCERTAINTY Discusses the techniques to deal with uncertainties 1 INTRODUCTION Few decisions in construction industry are made with certainty. Need to look at: The
EXAMINATION #3 ANSWER KEY
William M. Boal Version A EXAMINATION #3 ANSWER KEY I. Multiple choice (1)a. (2)a. (3)a. (4)b. (5)b. (6)b. (7)b. (8)c. (9)b. (10)e. II. Short answer (1) a. 3.2 %. b. 0.8 %. (2) a. 0 (shut down). b. 10
Economic decision analysis: Concepts and applications
Economic decision analysis: Concepts and applications Jeffrey M. Keisler Stockholm, 23 May 2016 My background and this work Education in DA and Economics Government and industry consulting Portfolio DA
7. The Cost of Production
7. The Cost of Production Literature: Pindyck and Rubinfeld, Chapter 7 Varian, Chapters 20, 21 Frambach, Chapter 3.3 30.05.2017 Prof. Dr. Kerstin Schneider Chair of Public Economics and Business Taxation
Case 7: The City Hotel Recovery Analysis CIS
Case 7: The City Hotel Recovery Analysis CIS 300-04 Danna Penaranda MARCH 29, 2015 SPRING 2015 TABLE OF CONTENTS The Business Situation... 2 No Change Scenario... 2 Figure 1.0.1 Debt decreases as rented
c) What optimality condition defines the profit maximizing amount of the input to use? (Be brief and to the point.) VMP = r, the cost of the input
AAE 320 Spring 2013 Exam #1 Name: KEY 1) (5 pts.) True or False? Mark your answer. a) T F_X_ In Strategic Management, a mission and goal are the same thing. b) T F_X_ Someday I d like to have some land
Homework 1 Solutions
Homework 1 Solutions ECON 5332 Government, Taxes, and Business Strategy Spring 28 January 22, 28 1. Consider an income guarantee program with an income guarantee of $3 and a benefit reduction rate of 5
Recall the conditions for a perfectly competitive market. Firms are price takers in both input and output markets.
McPeak Lecture 9 PAI 723 Competitive firms and markets. Recall the conditions for a perfectly competitive market. 1) The good is homogenous 2) Large numbers of buyers and sellers/ freedom of entry and
Review of Key Quantitative Problems for Final Exam Ted Mitchell
Review of Key Quantitative Problems for Final Exam Ted Mitchell One very important goal of this course is to ensure that all marketing students have mastered basic quantitative skills and have solved basic
<Table 1> Total Utility Marginal Utility Total Utility Marginal Utility
Economics 101 Answers to Homework #4 Fall 2009 Due 11/11/2009 before lecture Directions: The homework will be collected in a box before the lecture. Place your name, TA name and section number on top of
ch11 Student: 3. An analysis of what happens to the estimate of net present value when only one variable is changed is called analysis.
ch11 Student: Multiple Choice Questions 1. Forecasting risk is defined as the: A. possibility that some proposed projects will be rejected. B. process of estimating future cash flows relative to a project.
Chapter 7. Costs. An economist is a person who, when invited to give a talk at a banquet, tells the audience there s no such thing as a free lunch.
Chapter 7 Costs An economist is a person who, when invited to give a talk at a banquet, tells the audience there s no such thing as a free lunch. Chapter 7 Outline 7.1 Measuring Costs 7.2 Short-Run Costs
CS 343: Artificial Intelligence
CS 343: Artificial Intelligence Markov Decision Processes II Prof. Scott Niekum The University of Texas at Austin [These slides based on those of Dan Klein and Pieter Abbeel for CS188 Intro to AI at UC
Firm s demand for the input. Supply of the input = price of the input.
Chapter 8 Costs Functions The economic cost of an input is the minimum payment required to keep the input in its present employment. It is the payment the input would receive in its best alternative employment.
Economics 101 Spring 2000 Section 4 - Hallam Final Exam Version E - Blue
Economics 101 Spring 2000 Section 4 - Hallam Final Exam Version E - Blue 1. Marginal revenue measures a. the change in cost required to produce one more unit of output. b. the change in output that can
Answers A, B and C are all symptoms of overtrading whereas answer D is not as it deals with long term financing issues.
SECTION A 20 MARKS Question One 1.1 The answer is D Overtrading occurs when a company has inadequate finance for working capital to support its level of trading. The company is growing rapidly and is trying
Section 0: Introduction and Review of Basic Concepts
Section 0: Introduction and Review of Basic Concepts Carlos M. Carvalho The University of Texas McCombs School of Business mccombs.utexas.edu/faculty/carlos.carvalho/teaching 1 Getting Started Syllabus
Demand and income. Income and Substitution Effects. How demand rises with income. How demand rises with income. The Shape of the Engel Curve
Demand and income Engel Curves and the Slutsky Equation If your income is initially 1, you buy 1 apples When your income rises to 2, you buy 2 apples. To make the obvious point, demand is a function of
Economics 101 Section 5
Economics 101 Section 5 Lecture #10 February 17, 2004 The Budget Constraint Marginal Utility Consumer Choice Indifference Curves Overview of Chapter 5 Consumer Choice Consumer utility and marginal utility
Overview:Time and Uncertainty. Economics of Time: Some Issues
Overview:Time and Uncertainty Intertemporal Prices and Present Value Uncertainty Irreversible Investments and Option Value Economics of Time: Some Issues Cash now versus cash payments in the future? Future
1 Exam Prep Builder s Guide to Accounting (2)
1 Exam Prep Builder s Guide to Accounting (2) 1. All the following are normally required for a loan application except. A. an income statement B. a balance sheet C. a tax return D. retained earnings 2.
that internalizes the constraint by solving to remove the y variable. 1. Using the substitution method, determine the utility function U( x)
For the next two questions, the consumer s utility U( x, y) 3x y 4xy depends on the consumption of two goods x and y. Assume the consumer selects x and y to maximize utility subject to the budget constraint
13 The Costs of Production
Seventh Edition Principles of Economics N. Gregory Mankiw Wojciech Gerson (1831-1901) CHAPTER 13 The Costs of Production ACTIVE LEARNING 1 Brainstorming costs You run Ford Motor Company. List three different
PRODUCTION COSTS. Econ 311 Microeconomics 1 Lecture Material Prepared by Dr. Emmanuel Codjoe
PRODUCTION COSTS In this section we introduce production costs into the analysis of the firm. So far, our emphasis has been on the production process without any consideration of costs. However, production
Short Run Competitive Equilibrium. Figure 1 -- Short run Equilibrium for a Competitive Firm
Short Run Competitive Equilibrium In any economy, the determination of prices and outputs of goods and services is largely determined by the degree of competition in the industry 1. What do we mean by
Microeconomic Analysis
Microeconomic Analysis Competitive Firms and Markets Reading: Perloff, Chapter 8 Marco Pelliccia mp63@soas.ac.uk Outline Competition Profit Maximisation Competition in the Short Run Competition in the
Competitive Firms in the Long-Run
Competitive Firms in the Long-Run EC 311 - Selby May 18, 2014 EC 311 - Selby Competitive Firms in the Long-Run May 18, 2014 1 / 20 Recap So far we have been discussing the short-run for competitive firms
Econ 110: Introduction to Economic Theory. 10th Class 2/11/11
Econ 110: Introduction to Economic Theory 10th Class 2/11/11 go over practice problems second of three lectures on producer theory Last time we showed the first type of constraint operating on the firm:
Social Security Analysis And Strategy
1 Social Security Analysis And Strategy 617 Misty Isle Place Raleigh, NC 27615 Prepared for Fred Flintstone and Wilma Flintstone Prepared on August 23, 2016 2 Key Assumptions about This Report As you review
3. What is leverage? The magnification of risk that is realized when we add fixed cost operations and financing to the corporation.
Chapter 13 Study Guide 1. What is the risk return value rule? If risk increases, investors want more returns, so new investors would pay a lower price. Risk up, required return up, value down 2. What is
Production Management Winter 2002 Odette School of Business University of Windsor. Midterm Exam 2 Solution Tuesday, March 26, 7:00 9:00 pm
Name (print, please) ID Production Management 7-604 Winter 00 Odette School of Business University of Windsor Midterm Exam Solution Tuesday, March 6, 7:00 9:00 pm Instructor: Mohammed Fazle Baki Aids Permitted:
SAMPLE - NOT ACCURATE
Maximizing Your Social Security Benefits Your Personal Roadmap Your Order Order: #9999 Date: Need Help? Email: help@socialsecuritychoices.com Phone: (443)-990-1675 WHAT YOU LL FIND IN THIS GUIDE 1. Introduction:
1. $57.80 The bill is about $58. So, a 20% tip would be $58 divided by 5, which is $11.60.
End of Chapter Test Name Date Estimate a 20% tip for each of the bills shown. 1. $57.80 The bill is about $58. So, a 20% tip would be $58 divided by 5, which is $11.60. 2. $122.46 The bill is about $122.
Your Name: UM ID Number. Ford School of Public Policy 555: Microeconomics A Fall 2011 Exam 2 November 10, 2011 Professor Kevin Stange
Your Name: UM ID Number Ford School of Public Policy 555: Microeconomics A Fall 2011 Exam 2 November 10, 2011 Professor Kevin Stange This exam has 9 questions and spans the topics we have covered in the
1. Suppose a production process is described by a Cobb-Douglas production function f(v 1, v 2 ) = v 1 1/2 v 2 3/2.
1. Suppose a production process is described by a Cobb-Douglas production function f(v 1, v 2 ) = v 1 1/2 v 2 3/2. a. Write an expression for the marginal product of v 1. Does the marginal product of v
When one firm considers changing its price or output level, it must make assumptions about the reactions of its rivals.
Chapter 3 Oligopoly Oligopoly is an industry where there are relatively few sellers. The product may be standardized (steel) or differentiated (automobiles). The firms have a high degree of interdependence.
Exam A Questions Managerial Economics BA 445. Exam A Version 1
BA 445 Exam A Version 1 Dr. Jon Burke This is your Exam A. Exam A is a 100-minute exam (1hr. 40 min.). There are 6 questions (about 17 minutes per question). To avoid the temptation to cheat, you must
THE CATHOLIC UNIVERSITY OF EASTERN AFRICA A. M. E. C. E. A
THE CATHOLIC UNIVERSITY OF EASTERN AFRICA A. M. E. C. E. A MAIN EXAMINATION P.O. Box 62157 00200 Nairobi - KENYA Telephone: 891601-6 Fax: 254-20-891084 E-mail:academics@cuea.edu JANUARY APRIL 2014 TRIMESTER
Portfolio Optimization
Portfolio Optimization Stephen Boyd EE103 Stanford University December 8, 2017 Outline Return and risk Portfolio investment Portfolio optimization Return and risk 2 Return of an asset over one period asset
1 Maximizing profits when marginal costs are increasing
BEE12 Basic Mathematical Economics Week 1, Lecture Tuesday 9.12.3 Profit maximization / Elasticity Dieter Balkenborg Department of Economics University of Exeter 1 Maximizing profits when marginal costs
Marginal Revenue, Marginal Cost, and Profit Maximization pp
Marginal Revenue, Marginal Cost, and Profit Maximization pp. 262-8 We can study profit maximizing output for any firm, whether perfectly competitive or not Profit (π) = Total Revenue - Total Cost If q
Owning or operating corn Base Acres makes you eligible for corn direct payment No trigger for corn DP, just own or operate
AAE 320 Spring 2012 Final Exam Name: 1) (20 pts. total, 2 pts. each) True or False? Mark your answer. a) T F Wisconsin s cranberry industry may be important in the state, but nationally it ranks quite
Problem Set #1. Topic 1: Expected Value Maximization and Profit Measurement
Fall 2013 AGEC 317 Capps Problem Set #1 Topic 1: Expected Value Maximization and Profit Measurement 1. Suppose that Wal-Mart Stores, Inc. anticipates that profits over the next six years to be as follows:
Paul Krugman and Robin Wells. Microeconomics. Third Edition. Chapter 11 Behind the Supply Curve: Inputs and Costs. Copyright 2013 by Worth Publishers
Paul Krugman and Robin Wells Microeconomics Third Edition Chapter 11 Behind the Supply Curve: Inputs and Costs Copyright 2013 by Worth Publishers 1. Economics of the firm: An overview A. Profit = Revenue
Type of industry? Marginal & Average Cost Curves. OUTLINE September 25, Costs: Marginal & Average 9/24/ :24 AM
OUTLINE September 25, 2017 s Supply Decisions, continued Costs of Production (this is where we ended 9/20) Perfect Competition Produce q where MR=MC to maximize profit Calculating Profit If planning to