Week 3 assign man econ

Production Cost Analysis and Estimation Applied Problems

Please complete the following two applied problems:

Problem 1:

William is the owner of a small pizza shop and is thinking of increasing products and lowering costs. William’s pizza shop owns four ovens and the cost of the four ovens is $1,000. Each worker is paid $500 per week.

Workers employed

Qty of pizzas produced per week

0
1
2
3
4
5
6
7
8

0
75
180
360
600
900
1140
1260
1360

Show all of your calculations and processes. Describe your answer for each question in complete sentences, whenever it is necessary.

Which inputs are fixed and which are variable in the production function of William’s pizza shop? Over what ranges do there appear to be increasing, constant, and/or diminishing returns to the number of workers employed?
What number of workers appears to be most efficient in terms of pizza product per worker?
What number of workers appears to minimize the marginal cost of pizza production assuming that each pizza worker is paid $500 per week?
Why would marginal productivity decline when you hire more workers in the short run after a certain level?
How would expanding the business affect the economies of scale? When would you have constant returns to scale or diseconomies of scale? Describe your answer.

Problem 2:

The Paradise Shoes Company has estimated its weekly TVC function from data collected over the past several months, as TVC = 3450 + 20Q + 0.008Q2 where TVC represents the total variable cost and Q represents pairs of shoes produced per week. And its demand equation is Q = 4100 – 25P. The company is currently producing 1,000 pairs of shoes weekly and is considering expanding its output to 1,200 pairs of shoes weekly. To do this, it will have to lease another shoe-making machine ($2,000 per week fixed payment until the lease period ends).

Show all of your calculations and processes. Describe your answer for each item below in complete sentences, whenever it is necessary.

Describe and derive an expression for the marginal cost (MC) curve.
Describe and estimate the incremental costs of the extra 200 pairs per week (from 1,000 pairs to 1,200 pairs of shoes).
What are the profit-maximizing price and output levels for Paradise Shoes? Describe and calculate the profit-maximizing price and output.
Discuss whether or not Paradise Shoes should expand its output further beyond 1,200 pairs per week. State all assumptions and qualifications that underlie your recommendation.

Carefully review the Grading Rubric (Links to an external site.)Links to an external site. for the criteria that will be used to evaluate your assignment.

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July 1, 2023

1Q. What kinds of questions might Mc-Graw Hill have asked as part of determining the feasibility of the Primis idea?

2Q. How well did the systems approach work for the initial stages of the Primis system?

3Q. What could the team have done differently in the preliminary stages? How might this have affected the end result?

4Q. Would you have implemented the system, armed with the information the team had at the time? Why or Why not?

5Q. “Process engineering” is the design of business process to achieve competitive advantage in cost, quality, speed, and service. Which of these advantages were driving the development of the Primis System for McGraw-Hill?

6Q. What types of system design tools do you think Mc-Graw Hill used to develop the system’s functional requirements and technical specifications?

7Q. Business customers must perceive products/ services are solutions to their problems. How did the Primis system design keep this objective in mind?

8Q. The Primis team knew that technology would change in the short and long run, affecting the design of the system. How did the team with the knowledge of this inevitable and uncertainty?

9Q. Would prototyping have helped the Primis team? Why or Why not?

10Q. What role should end users have played in the development of the system?

11Q. What change management techniques did Mc-Graw Hill use to increase the chances of success of for the system?

12Q. Why was it important to consider the relationship of Primis to back-end systems at Mc-Graw-Hill?

13Q. If you were the project manager for Primis, what would have done differently? Explain your response.

14Q. If you were professor considering adoption of a custom textbook for your students, which form would you choose: black& white print or color eBook? Support your answer.

15Q. Part of system maintenance managing the growing volume of content in the Primis database. If you were managing this content, what criteria might you use for determining what gets added? Since many print textbooks are revised every few years, how would this process affect contents in the Primis database?