microbook_3e-page113

microbook_3e-page113 - Homework #7 Problems 1, 2 and 3 from...

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Homework #7 Problems 1, 2 and 3 from Ch. 8, p. 203-04 of Krugman/Wells Microeconomics (1st ed.) 1. Marty’s Frozen Yogurt is a small shop that sells cups of frozen yogurt in a university town. Marty owns three frozen-yogurt machines. His other inputs are refrigerators, frozen-yogurt mix, cups sprinkle toppings, and, of course, workers. He estimates that his daily production function when he varies the number of workers employed (and at the same time, of course, yogurt mix, cups and so on) is as shown in the accompanying table. fixed cost variable cost (from labor) variable cost (from other inputs) total cost qty. of labor in workers cups of frozen yogurt marginal product of labor total avg. total avg. total avg. total avg. marginal cost 0 0 – – $100 – – – – – – – – – – 1 110 $100 $80 $0 . 50 2 200 $100 $0 . 50 3 270 $100 $0 . 50 4 300 $100 $0 . 50 5 320 $100 $0 . 50 6 330 $100 $0 . 50 a. What are the fixed inputs and variable inputs in the production of cups of frozen yogurt? b. Draw the total product curve. Put the quantity of labor on the horizontal axis and the quantity of frozen
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This note was uploaded on 12/29/2011 for the course ECO 311 taught by Professor Willis during the Fall '10 term at SUNY Stony Brook.

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