4. The table below contains information on three techniques for producing soup. Assume theselling price of the soup is $4 per bowl and all techniques produce 5 bowls of soupResourceLaborLandCapitalEntrepreneurail abilityTotal cost to make 5 bowls of soup$2$1$3$4Units of ResouceTechnique 1Units3221Cost$6$2$654$18Technique 2Units3321Cost$6$3$6$4$19Technique 3Units4INH1Cost58.$5$3$4$20a. What technique would you want to use to produce soup? Why?b. How would a price change to $3 per bowl of soup change the firm's soup production.c Suppose the price of soup is $4.00 again but all resources are now $1 per unit. Whichis now the least profitable technique?

Profits are revenue minus the costs. Revenue is price times quantity and costs are determined by the…

4. The table below contains information on three techniques for producing soup. Assume the selling price of the soup is $4 per bowl and all techniques produce 5 bowls of soup Resource Labor Land Capital Entrepreneurail ability Total cost to make 5 bowls of soup $2 2533 $1 $3 $4 Units of Resouce Technique 1 Units 3 2 2 1 Cost $6 $2 $6 54 $18 Technique 2 Units Cost 3 3 2 1 $6 $3 $6 $4 $19 Technique 3 Units 4 5 1 1 Cost 58 $5 $4 $20 a. What technique would you want to use to produce soup? Why? b. How would a price change to $3 per bowl of soup change the firm's soup production. c. Suppose the price of soup is $4.00 again but all resources are now $1 per unit. Which is now the least profitable technique? |

4. The table below contains information on three techniques for producing soup. Assume the selling price of the soup is $4 per bowl and all techniques produce 5 bowls of soup Resource Labor Land Capital Entrepreneurail ability Total cost to make 5 bowls of soup $2 2533 $1 $3 $4 Units of Resouce Technique 1 Units 3 2 2 1 Cost $6 $2 $6 54 $18 Technique 2 Units Cost 3 3 2 1 $6 $3 $6 $4 $19 Technique 3 Units 4 5 1 1 Cost 58 $5 $4 $20 a. What technique would you want to use to produce soup? Why? b. How would a price change to $3 per bowl of soup change the firm's soup production. c. Suppose the price of soup is $4.00 again but all resources are now $1 per unit. Which is now the least profitable technique? |

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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