We are here with you hands in hands to facilitate your learning & don't appreciate the idea of copying or replicating solutions. Read More>>

Looking For Something at vustudents.ning.com? Click Here to Search

www.bit.ly/vucodes

+ Link For Assignments, GDBs & Online Quizzes Solution

www.bit.ly/papersvu

+ Link For Past Papers, Solved MCQs, Short Notes & More

SEMESTER SPRING 2012 Managerial Economics (ECO404) Assignment No. 01 Due Date: 26th April, 2012 Marks: 15

SEMESTER SPRING 2012
Managerial Economics (ECO404)
Assignment No. 01
Due Date: 26th April, 2012 Marks: 15

SEMESTER SPRING 2012
Managerial Economics (ECO404)
Assignment No. 01
Due Date: 26th April, 2012 Marks: 15
The Case:
Gujranwala is well known for the production and distribution of ceramics products. Ilyas
Sanitary firm is one of the major manufacturers of sanitary goods in Gujranwala. The firm
was started in 1978. This firm not only manufactures sanitary goods for Pakistan but also
exports its products to other countries. Suppose, this firm has 500 employees and it is paying
total amount of Rs. 7.5 million to these employees. The average salary of the employees is
Rs.15, 000. The firm is paying Rs. 2 million as interest payments to various banks. The
entrepreneur has a salary offer of Rs. 1.5 million annual from another company but he
refuses it for the sake of his own business. Further, firm is paying a total of Rs. 3 million as
operating lease of various plants. The firm is in the monopolistic competition where it has to
compete in the market with several other firms. The price elasticity of demand for the goods
of this company is -2.5. The firm is earning higher profit as its marginal revenue is equal to
the marginal cost. The marginal revenue and marginal cost of the firm is Rs. 240. The firm
wants to earn more profit by providing its products at lower rate.
Question # 01
From the information given above, calculate optimal level of price that firm should set to
obtain higher level of profit.
(Marks: 7)
Question # 02
The total cost function of the Illyas Sanitary firm is given as follows:
TC = 10+ 5Q+ 15Q2
From the above given equation, calculate:
A. Variable cost of the firm
B. Average total cost of the firm
C. Average variable cost of the firm
(Marks: A=2, B=3, C = 3)
Instructions:
Please read the following instructions carefully before preparing the assignment solution:
· Write down formula and all relevant steps involved in calculations
· Calculate to the point where calculation is being required. NO need to write
irrelevant material or extra interpretation.
· This Assignment can be best attempted from the knowledge acquired after
watching video lecture no. 1 to lecture no 14 and reading handouts as well as
recommended text book.
· Video lectures can be downloaded for free from www.youtube.com/vu
Note:
Only in the case of Assignment, 24 hours extra / grace period after the due date is
usually available to overcome uploading difficulties which may be faced by the
students on last date. This extra time should only be used to meet the emergencies
and above mentioned due dates should always be treated as final to avoid any
inconvenience.
Important Instructions:
Please read the following instructions carefully before attempting the assignment solution.
Deadline:
· Make sure that you upload the solution file before the due date. No
assignment will be accepted through e-mail once the solution has been
uploaded by the instructor.
Formatting guidelines:
· Use the font style “Times New Roman”/ “Arial” and font size “12”.
· It is advised to compose your document in MS-Word.
· Use black and blue font colors only.
Solution guidelines:
· Every student will work individually and has to write in the form of an
analytical assignment.
· Give the answer according to question.
· For acquiring the relevant knowledge don’t rely only on handouts but watch
the video lectures and use other reference books also.
Rules for Marking
Please note that your assignment will not be graded or graded as Zero (0) if:
· It has been submitted after due date
· The file you uploaded does not open or is corrupt
· It is in any format other than .doc (MS. Word)
It is cheated or copied from other students, internet, books, journals etc…
Important Note for those courses where calculations and graphs are
required.
· Calculate to the point where calculation is being required. NO need to write
irrelevant material or extra interpretation.
· Draw diagrams by yourself. Do NOT copy from any source. NO need to write
irrelevant material.

+ How to Join Subject Study Groups & Get Helping Material?

+ How to become Top Reputation, Angels, Intellectual, Featured Members & Moderators?

+ VU Students Reserves The Right to Delete Your Profile, If?


See Your Saved Posts Timeline

Views: 767

.

+ http://bit.ly/vucodes (Link for Assignments, GDBs & Online Quizzes Solution)

+ http://bit.ly/papersvu (Link for Past Papers, Solved MCQs, Short Notes & More)

+ Click Here to Search (Looking For something at vustudents.ning.com?)

+ Click Here To Join (Our facebook study Group)

Attachments:

Replies to This Discussion

btw thanx alot malik shab .. its a great help nhi tu isa pass karna na-mumkin tha : )

ye question 1 ka answer he?

 

ye question 1 he to question 2 ka kahan he solution?

tahira wo previous page par ha check that

ap akatha sab ik hi jaga pe likh do na plzz...sab ghuma ghuma k likha hua he.

yaar..:( solution bata do .. i hate economics..:(

Assignment No 1: ECO04

(A)
TC = 10 + 5Q + 15Q2
TC = Fix Cost + Variable Cost
VC = 5Q + 15Q2 …………………… (2)
VC = 5(7.83) + 15(7.83) 2
VC = 39.15 + 919.63
VC = 958.78
Variable cost is 958.78
(B) Average Total Cost
ATC = TC / Q
ATC = 10 / 7.83 + 5(7.83) / 7.83 + 15(7.83)2 / 7.83
ATC = 1.28 + 5 + 117.45
ATC = 123.73




© Average Variable Cost (AVC)

AVC = VC / Q
AVC = 958.78 / 7.83
AVC = 122.45

ECO404+Assignment#1+Complete+Solutoin+Spring+2012

See the attached file 

Attachments:

Answer No. 1

MR = MC = 240

Where as MR = MC = P / {1 + (1/E)}

 

                                    P = MC / {1 + (1/E)}

                                    P = 240 / {1+ (1/-2.5)}

                                    P = 240 / {1+ (-0.4)}

                                    P = 240/ 0.6

                                    P = 400

 

The optimum level of price that should be set to get the maximum level of higher profit is

400.

Answer No. 2

                       

TC   = 10 + 5Q + 15Q2       

                                    MC = dTC / dQ                            

                                    MC = 5 + 30Q                                   

                                     240 = 5 + 30Q

                                        Q = 7.83

Putting the value of Q in equation (2)

(A)

TC = 10 + 5Q + 15Q2

                                    TC = Fix Cost + Variable Cost

                                    VC = 5Q + 15Q2                 …………………… (2)

                                                VC = 5(7.83) + 15(7.83) 2

                                    VC = 958.78

Variable cost is 958.78

(B) Average Total Cost                                    

ATC = TC / Q

ATC = 10 / 7.83 + 5(7.83) / 7.83 + 15(7.83)2 / 7.83

ATC = 1.28 + 5 + 117.45

ATC = 123.73

 

 

 

 

 

 

(C) Average Variable Cost (AVC)

 

AVC = VC / Q

AVC = 958.78 / 7.83

AVC = 122.45

 

solution is here

solution is here

Muhammad Umair Sarwar

Student ID: mc110202009

MBA

Assignment No.1

Managerial Economics

Course Code: Eco404

________________________________________________________________________

 

Answer No. 1

MR = MC = 240

Where as MR = MC = P / {1 + (1/E)}

 

                                    P = MC / {1 + (1/E)}

                                    P = 240 / {1+ (1/-2.5)}

                                    P = 240 / {1+ (-0.4)}

                                    P = 240/ 0.6

                                    P = 400

 

The optimum level of price that should be set to get the maximum level of higher profit is

400.

Answer No. 2

                       

TC   = 10 + 5Q + 15Q2       

                                    MC = dTC / dQ                            

                                    MC = 5 + 30Q                                   

                                     240 = 5 + 30Q

                                        Q = 7.83

Putting the value of Q in equation (2)

(A)

TC = 10 + 5Q + 15Q2

                                    TC = Fix Cost + Variable Cost

                                    VC = 5Q + 15Q2                 …………………… (2)

                                                VC = 5(7.83) + 15(7.83) 2

                                    VC = 958.78

Variable cost is 958.78

(B) Average Total Cost                                    

ATC = TC / Q

ATC = 10 / 7.83 + 5(7.83) / 7.83 + 15(7.83)2 / 7.83

ATC = 1.28 + 5 + 117.45

ATC = 123.73

 

 

 

 

 

 

(C) Average Variable Cost (AVC)

 

AVC = VC / Q

AVC = 958.78 / 7.83

AVC = 122.45

 


Attachments:

RSS

Latest Activity

+ ՏhehαrZααD + replied to + ! ! ! ! ! ! ! ! ! ! ! ! ! ! !'s discussion روح کے زخم
8 minutes ago
+ ՏhehαrZααD + liked 彡JK彡 ❤️'s discussion ............. ایک تلخ حقیقت..........
12 minutes ago
+ ! ✨ ░S░I░N░G░E░R replied to 彡JK彡 ❤️'s discussion ............. ایک تلخ حقیقت..........
1 hour ago
+ ! ✨ ░S░I░N░G░E░R replied to + ! ! ! ! ! ! ! ! ! ! ! ! ! ! !'s discussion روح کے زخم
1 hour ago
+ ! ✨ ░S░I░N░G░E░R liked + ! ! ! ! ! ! ! ! ! ! ! ! ! ! !'s discussion روح کے زخم
1 hour ago
+ ! ✨ ░S░I░N░G░E░R liked +¢αяєℓєѕѕ gιяℓ's discussion عزت وہ ہے جس میں ہمارا قلب مطمئن ہوتا ہے
1 hour ago
+ ! ✨ ░S░I░N░G░E░R replied to + sílєnzíσ's discussion If fb, google nd youtube would have been subjects..... !!!!!!!!!!!!
1 hour ago
+ ! ✨ ░S░I░N░G░E░R replied to 彡JK彡 ❤️'s discussion ............. ایک تلخ حقیقت..........
1 hour ago
+ ! ✨ ░S░I░N░G░E░R liked 彡JK彡 ❤️'s discussion ............. ایک تلخ حقیقت..........
1 hour ago
+ ! ✨ ░S░I░N░G░E░R replied to +++STUDENT+++'s discussion Bya namaz
1 hour ago
+ ! ✨ ░S░I░N░G░E░R liked ++!!! Drama Queen's discussion !!!!!!!!!!!!!! KOn hay GALAT.............??????
1 hour ago
saniya gul joined + M.Tariq Malik's group
4 hours ago
saniya gul joined + M.Tariq Malik's group
4 hours ago
saniya gul joined + M.Tariq Malik's group
4 hours ago
saniya gul joined + M.Tariq Malik's group
4 hours ago
saniya gul joined + M.Tariq Malik's group
4 hours ago
Mahim Ch replied to + M.Tariq Malik's discussion VU Students Reserves The Right to Delete Any Profile On the Site
5 hours ago
Hadi updated their profile
6 hours ago
彡JK彡 ❤️ liked +¢αяєℓєѕѕ gιяℓ's discussion عزت وہ ہے جس میں ہمارا قلب مطمئن ہوتا ہے
6 hours ago
+ M.Tariq Malik liked + M.Tariq Malik's discussion 111 Solved MCQs of Financial Management MGT201
6 hours ago

© 2019   Created by + M.Tariq Malik.   Powered by

Promote Us  |  Report an Issue  |  Privacy Policy  |  Terms of Service