Chapter 3: Answers to Questions and Problems
Conceptual and Computational Questions
1.
a. When P = $12/unit, TR = ($12)(1) = $12/t.p. When P = $10, TR = ($10)(2) = $20, so
the price decrease results in an $8/t.p. increase in total revenue flow. Thus, sinc
Chapter 8: Answers to Questions and Problems
1.
a.
b.
c.
d.
e.
f.
Q* = 7 units/time period.
The market price, $28 per unit.
$224/t.p., since ATC(Q*) x Q* = $32 x 7 = $224.
$98/t.p., since AVC(Q*) x Q* = $14 x 7 = $98.
$126/t.p. (the difference between tot
Review of Mathematics for Managerial Economics
Percentages
= 0.6 250 = 150
1) What is 60% of 250?
2) 34 is what percent of 200?
%=
34
100 = 17%
200
3) 65 is what percent of 30?
%=
65
100 = 216.7%
30
4) A company sold 1978.2 thousand cases of soft drinks
Review of Mathematics for Managerial Economics
Show all steps in your work
Percentages
1) What is 60% of 250?
2) 34 is what percent of 200?
3) 65 is what percent of 30?
4) A company sold 1978.2 thousand cases of soft drinks in a total market of 9500 milli
Introduction to Derivatives (Calculus)
What Are Derivatives?
Derivatives are ratios of changes in the magnitudes of variables that are related to each other. For example, if y
is a function of x, the "derivative of y with respect to x" is the ratio of a c
Chapter 5: Answers to Questions and Problems
1.
= 16 units of the
a. When K = 16 machines and L = 16 workers, Q = ( 16 ) ( 16 )
product per time period. Thus, APL(16) = Q/L = 16/16 = 1 unit/worker. If K is still
0.75
0.25
= ( 8 ) ( 3) = 24 units/t.p. Thus
Chapter 2: Answers to Questions and Problems
1. a. Since X is a normal good, an increase in consumer income will lead to an
increase in the demand for X (the demand curve for X will shift to the right).
b. Since Y is an inferior good, a decrease in income
Chapter 1: Answers to Questions and Problems
2.
The maximum you would be willing to pay for this asset is the present value of its
income stream, which is
PV =
150, 000
150, 000
150, 000
150, 000
150, 000
+
+
+
+
2
3
4
( 1 + 0.09 ) ( 1 + 0.09 ) ( 1 + 0.09
ECON 301 Textbook Errors, Sections to be Skipped, and Exercises in Chapters 1 3 and 5 8
CHAP. 1 - The Fundamentals of Managerial Economics
Omit pages 8 14, but resume reading on p. 14 at Recognize the Time Value of Money.
Omit section beginning on p.17, s