ENGR.ECONOMY CUSTOM FOR TAMU ISEN 667
8th Edition
ISBN: 9781307584394
Author: Blank
Publisher: MCG/CREATE
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Question
Chapter 15, Problem 41P
(a):
To determine
Calculate the overall cost factor.
(b):
To determine
Components of cost factor.
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4. The table below shows the labor requirements for Mr. and Mrs.
Howell for pineapples and coconuts. Which is the most accurate
statement?
A. Mrs. Howell has a comparative advantage in coconuts and the
opportunity cost of 1 coconut for Mrs. Howell is 4 pineapples
B. Mrs. Howell has a comparative advantage in pineapples and the
opportunity cost of 1 pineapple for Mrs. Howell is .25 coconuts.
C. Mr. Howell has a comparative advantage in pineapples and the
opportunity cost of 1 pineapple is 1 coconut.
D. Mr. Howell has a comparative advantage in both pineapples and
coconuts and should specialize in pineapples.
Labor Requirements for Pineapples and Coconuts
1 Pineapple
1 Coconut
Mr. Howell
1 hour
1 hour
Mrs. Howell
1/2 hour
2 hours
4. Supply and Demand. The table gives hypothetical data for the quantity of
electric scooters demanded and supplied per month.
Price per
Electric Scooter
Quantity
Quantity
Demanded
Supplied
$150
500
250
$175
475
350
$200
450
450
$225
425
550
$250
400
650
$275
375
750
a. Graph the demand and supply curves. Note if you prefer to hand draw
separately, you may and insert the picture separately.
Price per
Scooter
300
275
250
225
200
175
150
250
400
375425475
350 450
550 650 750
500
850 Quantity
b. Find the equilibrium price and quantity using the graph above.
c. Illustrate on your graph how an increase in the wage rate paid to scooter
assemblers would affect the market for electric scooters. Label any new lines in
the same graph above to distinguish changes.
d. What would happen if there was an increase in the wage rate paid to scooter
assemblers at the
same time that tastes for electric scooters increased?
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3. Production Costs
Clean 'n' Shine is a competitor to Spotless Car Wash. Like Spotless, it must pay $150 per day for
each automated line it uses. But Clean 'n' Shine has been able to tap into a lower-cost pool of labor,
paying its workers only $100 per day. Clean 'n' Shine's production technology is given in the
following table. To determine its short-run cost structure, fill in the blanks in the table.
Fill in the columns below.
Outpu Capita Labor TFC
TVC
TC
MC
AFC
AVC
ATC
1 0
30
1 1
70 1 2
120
1 3
160
1
4
190
1 5
210
1 6
a. Over what range of output does Clean 'n' Shine experience increasing
marginal returns to labor? Over what range does it experience diminishing
marginal returns to labor? (*answer both questions)
b. As output increases, do average fixed costs behave as described in the text?
Explain.
C. As output increases, do marginal cost, average variable cost, and average
total cost behave as described in the text? Explain.
d. Looking at the numbers in the table, but without…
Chapter 15 Solutions
ENGR.ECONOMY CUSTOM FOR TAMU ISEN 667
Ch. 15 - Prob. 1PCh. 15 - Prob. 2PCh. 15 - Prob. 3PCh. 15 - Prob. 4PCh. 15 - Prob. 5PCh. 15 - Prob. 6PCh. 15 - Prob. 7PCh. 15 - Prob. 8PCh. 15 - Prob. 9PCh. 15 - Prob. 10P
Ch. 15 - Prob. 11PCh. 15 - Prob. 12PCh. 15 - Prob. 13PCh. 15 - Prob. 14PCh. 15 - Prob. 15PCh. 15 - Prob. 16PCh. 15 - Prob. 17PCh. 15 - Prob. 18PCh. 15 - Prob. 19PCh. 15 - Prob. 20PCh. 15 - Prob. 21PCh. 15 - Prob. 22PCh. 15 - Prob. 23PCh. 15 - Prob. 24PCh. 15 - Prob. 25PCh. 15 - Prob. 26PCh. 15 - Prob. 27PCh. 15 - Prob. 28PCh. 15 - Prob. 29PCh. 15 - Prob. 30PCh. 15 - Prob. 31PCh. 15 - Prob. 32PCh. 15 - Prob. 33PCh. 15 - Prob. 34PCh. 15 - Prob. 35PCh. 15 - Prob. 36PCh. 15 - Prob. 37PCh. 15 - Prob. 38PCh. 15 - Prob. 39PCh. 15 - Prob. 40PCh. 15 - Prob. 41PCh. 15 - Prob. 42PCh. 15 - Prob. 43PCh. 15 - Prob. 44PCh. 15 - Prob. 45PCh. 15 - Prob. 46PCh. 15 - Prob. 47PCh. 15 - Prob. 48PCh. 15 - Prob. 49PCh. 15 - Prob. 50PCh. 15 - Prob. 51PCh. 15 - Prob. 52PCh. 15 - Prob. 53PCh. 15 - Prob. 54PCh. 15 - Prob. 55PCh. 15 - Prob. 56PCh. 15 - Prob. 57APQCh. 15 - Prob. 58APQCh. 15 - Prob. 59APQCh. 15 - Prob. 60APQCh. 15 - Prob. 61APQCh. 15 - Prob. 62APQCh. 15 - Prob. 63APQCh. 15 - Prob. 64APQCh. 15 - Prob. 65APQCh. 15 - Prob. 66APQCh. 15 - Prob. 67APQCh. 15 - Prob. 68APQCh. 15 - Prob. 1CS1Ch. 15 - Prob. 2CS1Ch. 15 - Prob. 3CS1Ch. 15 - Prob. 4CS1Ch. 15 - Prob. 5CS1Ch. 15 - Prob. 1CS2Ch. 15 - Prob. 2CS2Ch. 15 - Prob. 3CS2Ch. 15 - Prob. 4CS2Ch. 15 - Prob. 5CS2
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