Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
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Question
Chapter 1, Problem 1WNG
To determine
Marginal benefit curve and marginal cost curve.
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Think of an economic
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1. Working with Numbers and Graphs Q1
Suppose the marginal costs of reading are constant at $5 per hour, while the marginal benefits of reading decline (over time) as more reading is
performed. In particular, suppose the following table contains the marginal benefit associated with various levels of hours spent reading.
Time Spent Reading Marginal Benefits
(Hours)
(Dollars per hour)
8
3
12
Assume the marginal-benefit curve is a straight line through the two points described in the table.
MARGINAL COST, MARGINAL BENEFIT ($ per hour of reading per week)
On the following graph, use the blue points (circle symbol) to plot the marginal-benefit curve for reading. Next, use the orange points (square symbol)
to plot the marginal-cost curve for reading. Finally, use the black point (plus symbol) to indicate the point corresponding to the efficient amount of
reading (that is, the point at which the net benefits of reading are maximized).
00
32
N
0
2
3
+
6
9 12 15 18 21
READING (Hours per week)…
Can you please show the detailed steps involved that took you to the final answers so that I can understand?
1.Suppose the marginal costs (MC) of reading are constant & the marginal benefits (MB) of reading decline (over time). Initially, the MB of Reading are greater than the MC. Draw the MB curve and MC curve of studying, & identify the efficient amount of reading. Then explain why the efficient point is the point at which the net benefits of reading are maximized. ________________________________________________2. Using the diagram you drew in question 1, lower the marginal costs of reading and identify the new efficient amount of reading. Also, identify the additional net benefits derived as a result of the lower marginal cost of reading.
Chapter 1 Solutions
Economics (MindTap Course List)
Ch. 1.2 - Prob. 1STCh. 1.2 - Prob. 2STCh. 1.2 - Prob. 3STCh. 1.3 - Prob. 1STCh. 1.3 - Prob. 2STCh. 1.3 - Prob. 3STCh. 1.4 - Prob. 1STCh. 1.4 - Prob. 2STCh. 1.4 - Prob. 3STCh. 1.4 - Prob. 4ST
Ch. 1 - Prob. 1QPCh. 1 - Prob. 2QPCh. 1 - Prob. 3QPCh. 1 - Prob. 4QPCh. 1 - Prob. 5QPCh. 1 - Prob. 6QPCh. 1 - Prob. 7QPCh. 1 - Prob. 8QPCh. 1 - Prob. 9QPCh. 1 - Prob. 10QPCh. 1 - Prob. 11QPCh. 1 - Prob. 12QPCh. 1 - Prob. 13QPCh. 1 - Prob. 14QPCh. 1 - Prob. 15QPCh. 1 - Prob. 16QPCh. 1 - Prob. 17QPCh. 1 - Prob. 18QPCh. 1 - Prob. 19QPCh. 1 - Prob. 20QPCh. 1 - Prob. 21QPCh. 1 - Prob. 22QPCh. 1 - Prob. 23QPCh. 1 - Prob. 24QPCh. 1 - Prob. 25QPCh. 1 - Prob. 26QPCh. 1 - Prob. 1WNGCh. 1 - Prob. 2WNGCh. 1 - Prob. 3WNG
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