Chapter 6, Problem 4QFD

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? 1ང

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…