assignment #1 ECN 203 - Name:Xiangying Wu Assignment#1...

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Name:Xiangying Wu Assignment #1, ECN203,M007 1. a.The marginal utility of the third candy bar=(54 - 42)/1=12 b.As one buys more and more candy, the marginal utility of each candy decreases— from the 25 (the first candy), 27(the second candy), 22(the third candy), 17(the fourth candy), to 3(the fifth candy). One feels less and less happier after get the third candy. The above is called the diminishing marginal utility. c.In this case, only the quantity of the candies changes, but other things (like price and taste ) are not change, and this is called ceteris paribus. 2. a. Marginal product of the fourth worker= (70 - 60)/1=10 b. As more and more workers are involved in making and selling ice cream cones, the amount of sold ice cream cones per labor is always positive. Like the marginal product of the first, second, third, fourth and fifth worker is 20,25,15,10 and 6 respectively. c. the physical capitals for this firm’s production are machines for producing ice cream cones, the cars for transporting the ice cream cones, and the refrigerators for
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