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SOLUTIONS TO ECON QUIZ

# 47 d this is the profitmaximizing condition for

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Unformatted text preview: its = Total revenue – (explicit + implicit costs). From the information TR = 75,000; Lori incurs explicit costs of \$24,000 for the lease, \$6,000 for the student, and \$14,000 for supplies; the implicit costs are \$32,000 for the job she quit. Plug that in and there’s your answer. 39. C, just the definition. 40. A, use the formula MPL = ∆Q/∆L. MPL = (30 ­25)/(4 ­3)= 5. 41. C, use the formula APL = Q/L. APL = 30/4 = 7.5. 42. A, see the graph lecture slides or notes if I get them to you. 43. B, really it is B. But just remember that for our class, opportunity costs = explicit + implicit. 44. A, see the graph in notes if I get them to you. 45. A, short ­run shutdown decision...
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