hw05 - UNIVERSITY OF WISCONSIN Economics 101 Spring 2007...

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UNIVERSITY OF WISCONSIN Economics 101 – Spring 2007 Professor Wallace Problem Set 5 Due on March 9th at noon in your TA’s mailbox (opposite 7226 SS) Please be sure to include (1) your name , (2) your teaching assistant’s name , and (3) your section time and number on your answer sheet. Please staple pages together. Also note that late homework will not be accepted. Remember that you can help each other but each student has to hand a hand-written solution of the problem set. 1. In Economics, we assume firms want to maximize their (a) Total Revenue (b) Total Profit (c) Total Quantity produced (d) Price of the good 2. What does one mean when he says that "The firms production is efficient"? (a). The firm maximizes its profit. (b). The firm hires as many workers (labors) as possible. (c). The firm cannot produce its current level of output with lesser number of inputs. (d). Quantity produced is exactly same as the quantity demanded. 3. An Italian restaurant can serve 100 handmade pastas with 5 chefs or with 1 chef and 1 pasta machine. According to that, which of the following statements would be true? (a) The Italian restaurant attains its maximum profit with either 5 chefs or 1 chef and 1 pasta machine. (b) The Italian restaurant should choose 1 chefs and 1 pasta machine. (c) The marginal product of hiring a chef is diminishing.
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This note was uploaded on 07/11/2008 for the course ECON 101 taught by Professor Hansen during the Spring '07 term at Wisconsin.

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hw05 - UNIVERSITY OF WISCONSIN Economics 101 Spring 2007...

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