# ps_9 - Problem Set#9 Ec 201 Michigan State University...

This preview shows pages 1–3. Sign up to view the full content.

Problem Set #9 Ec 201 Spring, 2009 Michigan State University L. Martin 1. Pruney’s Pruners prunes perennials in Pontiac. She hires pruners for \$40 per day. She charges her customers \$2 per pruned perennial. Her production function is given below. Pruners Perennials Marginal product Value of the Marginal (labor days) (output per day) Product 1 40 2 70 3 90 4 100 5 105 a. Complete the table. b. Find the profit maximizing number of pruners to hire. c. Draw a diagram. 2. The Sad Sack Sax Sacks company produces convenient carrying cases for Saxaphones. It has fixed costs of \$100, none of which are recoverable. The price is \$80 per case. Output Total cost Average cost Average recoverable Marginal cost cost 0 \$100 1 \$110 2 \$130 3 \$160 4 \$200 5 \$250 6 \$310 7 \$380 8 \$460 9 \$550 10 \$650 a. Complete the table. b. Find the profit maximizing number of perennials to prune. c. Find the exit price.

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
d. Find the entry price. e.
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### Page1 / 4

ps_9 - Problem Set#9 Ec 201 Michigan State University...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online