Submitted by Drummond, Craig (CHD5082) on 2/10/2017 3:45:35 PM
Points Awarded
97.75
Points Missed
2.25
Percentage
97.8%
1.SCENARIO B: Suppose that due to favorable economic conditions, the price that this firm can sell its product for rises to $22.For question 1. Fill in Table B - Each box is worth ½ point for a total of 9 points for Table BTABLE B- The wage is still $150 and the price of output (Q) is now $22.
L
Q
MP
L
MRP
Marginal Profit
Total Profit
0
0
----
----
-------------
0
1
8
8
$
$
$
2
20
12
$
$
$
3
28
8
$
$
$
4
35
7
$
$
$
5
41
6
$
$
$
6
45
4
$
$
$
Table for Individual Question Feedback
Points Earned:
9.0/9.0

Box 14: -18;
Box 15: 152;
Box 16: 88;
Box 17: -62;
Box 18: 90
2.
Use Scenario B/Table B to answer the questions 2 – 4 below.
(3 points) The profit maximizing output (Q) is .
Table for Individual Question Feedback
Points Earned:
3.0/3.0
3.
(3 points) The profit maximizing level of labor (L) input is workers.
Table for Individual Question Feedback
Points Earned:
3.0/3.0
Correct Answer(s):
4
4.
(3 points) The maximum profit for this firm is .
Table for Individual Question Feedback
Points Earned:
3.0/3.0
Correct Answer(s):
170
5.
DOWNLOAD AND PRINT GRAPHING TEMPLATE (available in the homework 3 instructions).
This template already shows the outcome from scenario A. You will be adding results from
scenario B to these graphs.
(2 points) Using Scenario B/Table B, go to
Graph 1
. Label the new profit maximizing Q and L
combination on the production function as point B.
Table for Individual Question Feedback
Points Earned:
2.0/2.0
Correct Answer(s):

6.
(3 points) Using Scenario B/Table B, go to Graph 2 and draw this firm’s newMRP curve (remember that MRP = P* MPL, and since price changed, we know we have a new MRP curve!). Shade in the new area of profit. Also label the new profit maximizing point as letter B.Table for Individual Question Feedback
Points Earned:
3.0/3.0