A perfectly competitive firm, making tomato paste, operating in a market-determined price of (50) Saudi Riyals per box. Costs and revenues are calculated in this case in daily bases. A daily wage rate per worker is 200SR. In the table below, units of labors and total fixed costs are listed. Using the attached table, answer the questions below:- First: 1- Fill in the blanks in column 3 of the table by computing the marginal product of labor for each level of labor usage. 2- Fill in the blanks in column 4 of the table by computing total revenue. 3- Fill in the blanks in column 5 of the table by computing marginal revenue. 4- Fill in the blanks in column 6 of the table by computing total cost. 5- Fill in the blanks in column 7 of the table by computing average total cost. 6- Fill in the blanks in column 9 of the table by computing total variable cost. Question\#2 Naif wants to expand the capacity of his restaurant, but not sure if the coronavirus and its variant would vanish by the year 2022. He has the probability of 60%, that the virus will disappear and life will return completely to normal by 2022, while he has the probability of 40%, it would not occur. 7- Fill in the blanks in column 10 of the table by computing With respect to the table above, answer the followings: 1. Compute the expected profits for both decisions? 2. Based on the expected profit only, which decision should Naif make? 3. Compute the Standard Deviation for decisions A and B, facing Naif? 4. Which decision would Naif make, using the coefficient of variation? . 5. If Naif has no idea of the probability distribution of the virus disappearance by the year 2022, i.e., operating an uncertainty world. Using the information above, what decision would Naif make, according to each of the following rules: Ninth: To which extent the Law of Diminishing Marginal Product is applicable in this case? Explain? Tenth: How does market power is related to price elasticity of demand and cross-price plasticity of demand? Eleventh: What is the opportunity cost when you are in state of maximizing profit as in this case? Twelfth: Should be the economic profit is equivalent to the accounting profit in this case? Explain? Attached (Table) A perfectly competitive firm, making tomato paste, operating in a market-determined price of (50) Saudi Riyals per box. Costs and revenues are calculated in this case in daily bases. A daily wage rate per worker is 200SR. In the table below, units of labors and total fixed costs are listed. Using the attached table, answer the questions below:- First: 1- Fill in the blanks in column 3 of the table by computing the marginal product of labor for each level of labor usage. 2- Fill in the blanks in column 4 of the table by computing total revenue. 3- Fill in the blanks in column 5 of the table by computing marginal revenue. 4- Fill in the blanks in column 6 of the table by computing total cost. 5- Fill in the blanks in column 7 of the table by computing average total cost. 6- Fill in the blanks in column 9 of the table by computing total variable cost. Question\#2 Naif wants to expand the capacity of his restaurant, but not sure if the coronavirus and its variant would vanish by the year 2022. He has the probability of 60%, that the virus will disappear and life will return completely to normal by 2022, while he has the probability of 40%, it would not occur. 7- Fill in the blanks in column 10 of the table by computing With respect to the table above, answer the followings: 1. Compute the expected profits for both decisions? 2. Based on the expected profit only, which decision should Naif make? 3. Compute the Standard Deviation for decisions A and B, facing Naif? 4. Which decision would Naif make, using the coefficient of variation? . 5. If Naif has no idea of the probability distribution of the virus disappearance by the year 2022, i.e., operating an uncertainty world. Using the information above, what decision would Naif make, according to each of the following rules: Ninth: To which extent the Law of Diminishing Marginal Product is applicable in this case? Explain? Tenth: How does market power is related to price elasticity of demand and cross-price plasticity of demand? Eleventh: What is the opportunity cost when you are in state of maximizing profit as in this case? Twelfth: Should be the economic profit is equivalent to the accounting profit in this case? Explain? Attached (Table)
