Suppose there are four villagers who can either raise sheep or bake bread. A sheepherder must buy a sheep for $200, raise it on the common and then sell it at the market in a nearby town. The table below shows how much a sheepherder can sell a sheep for. In the same time it takes to bring a sheep to the market, bread bakers can make a profit of $35. You will need to copy the table and fill it in as you answer the questions. A. Assuming each villager acts independently, how many sheep will be raised on the common? B. What is the total income of all four villagers? $ Part 2 Suppose you are the village elder. You no longer raise sheep or bake. Instead you sit around all day contemplating the meaning of life. One day you realize that the total profit of the village would be higher if fewer sheep were on the common. How many sheep should be on the common in order to maximize the village's profit? _______ sheep Part 3 Suppose there are two sheep on the common. A villager is considering adding another sheep. If the villager does, he or she is better off by $_______ compared to what he or she could earn as a baker. However, he or she imposes a cost of $ _________ on the other two villagers who already have sheep on the common.
Suppose there are four villagers who can either raise sheep or bake bread. A sheepherder must buy a sheep for $200, raise it on the common and then sell it at the market in a nearby town. The table below shows how much a sheepherder can sell a sheep for. In the same time it takes to bring a sheep to the market, bread bakers can make a profit of $35. You will need to copy the table and fill it in as you answer the questions. A. Assuming each villager acts independently, how many sheep will be raised on the common? B. What is the total income of all four villagers? $ Part 2 Suppose you are the village elder. You no longer raise sheep or bake. Instead you sit around all day contemplating the meaning of life. One day you realize that the total profit of the village would be higher if fewer sheep were on the common. How many sheep should be on the common in order to maximize the village's profit? _______ sheep Part 3 Suppose there are two sheep on the common. A villager is considering adding another sheep. If the villager does, he or she is better off by $_______ compared to what he or she could earn as a baker. However, he or she imposes a cost of $ _________ on the other two villagers who already have sheep on the common.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Suppose there are four villagers who can either raise sheep or bake bread. A sheepherder must buy a sheep for $200, raise it on the common and then sell it at the market in a nearby town. The table below shows how much a sheepherder can sell a sheep for. In the same time it takes to bring a sheep to the market, bread bakers can make a profit of $35. You will need to copy the table and fill it in as you answer the questions.
A. Assuming each villager acts independently, how many sheep will be raised on the common?
B. What is the total income of all four villagers? $
Part 2
Suppose you are the village elder. You no longer raise sheep or bake. Instead you sit around all day contemplating the meaning of life. One day you realize that the total profit of the village would be higher if fewer sheep were on the common. How many sheep should be on the common in order to maximize the village's profit? _______ sheep
Part 3
Suppose there are two sheep on the common. A villager is considering adding another sheep. If the villager does, he or she is better off by $_______ compared to what he or she could earn as a baker. However, he or she imposes a cost of $ _________ on the other two villagers who already have sheep on the common.
Transcribed Image Text:m
Total profit from
sheep
Additional profit
from one sheep
Transcribed Image Text:Number of sheep
feeding on the
common
1
2
3
4
Price of a sheep at
market
$300
270
240
210
Profit
on
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