Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Steel was once rare and expensive, which limited its use to small items like knives. Technological innovations in steel production processes increased the total factor

image text in transcribed
Steel was once rare and expensive, which limited its use to small items like knives. Technological innovations in steel production processes increased the total factor produc- tivity by orders of magnitude, so steel is the most widely used metal today. Maj or inno- vations include the Bessemer process (1857), the Siemens-Martin and Basic Oxygen pro- cesses (early 20th century). Mills using these processes are called \"integrated\" steel mills. After World War II, the U.S. became the world's largest producer of steel, with approxi- mately 39 large, highly capital-intensive integrated steel mills in operation by 1968 in the U.S. supplying a highly competitive global market. Each integrated steel mill could pro- duce steel at a total cost in dollars per ton of TC(q) = 498 + 28q + 78:12 where q is in millions of tons of steel produced per year, and 498 is the annual amortized xed cost. (Note: no unit conversions are needed; use numbers as given.) Total annual demand in tons for U.S. steel in 1968 was Q = 200 0.2P where P is the price per ton in dollars and Q is millions of tons. a. The total aggregate demand for U.S. steel in 1968 was million tons, sold at $ per ton. Each steel mill earned $ prot. The introduction of the Electric-Arc Mini-Mill technology by Nucor Steel in 1969 dis- rupted the industry yet again by improving process efciency using smaller mills with lower capital cost. These mills each had a total annual production cost of TC(q) = 112.5 + 20:; + 200q2 A total of 113 Mini-Mills were operating. By 2019, the industry reached long-run levels. Operators of the 39 older integrated steel mills had to decide whether to shutdown or con- tinue operating. b. There were (number) of integrated mills operating in addition to the Mini-Mills. The total aggregate demand for U.S. steel in 2019 was mil- lion tons, sold at $ per ton

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Global Capitalism Its Fall And Rise In The Twentieth Century

Authors: Jeffry Frieden

1st Edition

039332981X, 9780393329810

More Books

Students also viewed these Economics questions

Question

In your opinion, who should define normal versus abnormal behavior?

Answered: 1 week ago

Question

What do you mean by activity and selectivity of catalysts?

Answered: 1 week ago

Question

6 Explain the expectancy theory of motivation.

Answered: 1 week ago