ps2ans - Economics 101 Introductory Microeconomics Fall...

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f4b442a26fc2ca99a142219417e555226953ab3d.xls Instructions 1 How to submit Excel Problem Sets Cornell Code of Academic Integrity Economics 101 -- Introductory Microeconomics Fall 2007, Prof. John M. Abowd Excel Problem Set 2 Assigned 10/16/2007 Due: 10/30/2007 9:00am This problem set asks you to use the tools available in Excel to solve some problems in the theory of producer and consumer behavior. Fill in this information before you begin: Name: ANSWERED Network ID: Section number: TA name: You must do this assignment in Microsoft Excel and submit it using the course web site. It will be graded by your TA, after which you can collect it from the course web site (click the link at the bottom of this sheet for instructions on how to do this). YOU ARE EXPECTED TO ANSWER THESE QUESTIONS YOURSELF. YOU SHOULD NOT COPY THE SPREADSHEET OF ANOTHER STUDENT. IF YOU SUBMIT ANOTHER STUDENT'S ANSWERS, YOU WILL BE SUBJECT TO PENALTIES UNDER THE CORNELL CODE OF ACADEMIC INTEGRITY (see link below). IF YOU WORK IN A GROUP, YOU MUST STILL SUBMIT YOUR OWN ANSWERS, NOT COPIES OF YOUR GROUP'S ANSWERS. Answer each question in the worksheet provided. Each question is on a separate worksheet -- look along the tabs at the bottom to see the sheet names. Make sure your answers are neatly presented. Use text boxes for text answers and labeled graphs, when requested. If your TA has trouble reading your answer because you have been sloppy (for example, by typing an answer in a long line of a single cell), you will be marked down. We strongly suggest that you Print Preview your answers before submitting the problem set. If the Print Preview looks good, your TA will have no trouble grading your problem set. Grade: Comments:
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f4b442a26fc2ca99a142219417e555226953ab3d.xls Q1 2 Total Cost Profit 0 10.00 60 NA 10 10.00 100 20 10.00 160 30 10.00 220 40 10.00 300 50 10.00 420 60 10.00 580 70 10.00 730 NA Quantity Price (MR) Total Cost Profit 0 10.00 0 60.0 -60.0 NA 10 10.00 100 100.0 0.0 5.00 20 10.00 200 160.0 40.0 6.00 30 10.00 300 220.0 80.0 7.00 40 10.00 400 300.0 100.0 10.00 50 10.00 500 420.0 80.0 14.00 60 10.00 600 580.0 20.0 15.50 70 10.00 700 730.0 -30.0 NA Quantity (pounds of cookies) Price per pound Total Revenue Marginal Cost (per pound) Total Revenue Marginal Cost Answers a) Price = marginal revenue (by definition of a competitive market, but you can verify this by using the midpoint formula on the total revenue figures). The table below shows the total revenue and profit at each quantity. Total revenue = the number of pounds of cookies sold multiplied by the price of each pound. Profit = total revenue - total cost. From the table, we see that profits are maximized when Amanda produces 40 pounds On the first graph below, the profit is given by the vertical distance between the total revenue and total cost schedules. Notice that at a quantity of 0 and a quantity of 70 pounds, profit is negative (total cost exceeds total revenue). Total Costs and Revenues for Cookie Production
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This note was uploaded on 02/19/2008 for the course ECON 1110 taught by Professor Wissink during the Fall '06 term at Cornell.

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ps2ans - Economics 101 Introductory Microeconomics Fall...

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