Exam (elaborations)
ECON 104 HOMEWORK 3 QUESTION AND ANSWERS ( LATEST UPDATE )
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- Pennsylvania State University - All Campuses
ECON 104 HOMEWORK 3 QUESTION AND ANSWERS
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1.SCENARIO B: Suppose that due to favorable economic conditions, the price that this firm can sell its product for rises to $22.
For question 1. Fill in Table B - Each box is worth ½ point for a total of 9 points for Table B
TABLE B- The wage is still $150 and the price of output (Q) is now $22.ECON 104 HOMEWORK 3 QUESTION AND ANSWERS
LQMPLMRPMarginal ProfitTotal Profit
00-------- ------------- 0
188$
176$
26$
26
22012$
264$
114$
140
3288$
176$
26$
166
4357$
154$
4$
170
5416$
132$
-18$
152
6454$
88$
-62$
90
Table for Individual Question Feedback Points Earned:
9.0/9.0 Correct Answer(s):
Box 1: 176;
Box 2: 26;
Box 3: 26;
Box 4: 264;
Box 5: 114;
Box 6: 140;
Box 7: 176;
Box 8: 26; 2.
Use Scenario B/Table B to answer the questions 2 – 4 below.
(3 points) The profit maximizing output (Q) is .35Box 9: 166;
Box 10:
154;
Box 11: 4;
Box 12:
170;
Box 13:
132;
Box 14:
-18;
Box 15:
152;
Box 16: 88;
Box 17:
-62;
Box 18: 90
Table for Individual Question Feedback Points Earned:
3.0/3.0 Correct Answer(s): 35
3.(3 points) The profit maximizing level of labor (L) input isworkers.
4
Table for Individual Question Feedback Points Earned:
3.0/3.0 Correct Answer(s): 4
4.(3 points) The maximum profit for this firm is.
170
Table for Individual Question Feedback
Points Earned: 3.0/3.0 5.
DOWNLOAD AND PRINT GRAPHING TEMPLATE (available in the homework 3 instructions). This template already shows the outcome from scenario A. You will be adding results from scenario B to these graphs.
(2 points) Using Scenario B/Table B, go to Graph 1. Label the new profit maximizing Q and L combination on the production function as point B.
6.
(3 points) Using Scenario B/Table B, go to Graph 2 and draw this firm’s new MRP curve (remember that MRP = P* MPL, and since price changed, we know we have a new MRP curve!). Shade in the new area of profit. Also label the new profit maximizing point as letter B.Correct Answer(s):170
Table for Individual Question Feedback
Points Earned: 2.0/2.0
Correct Answer(s):
Table for Individual Question Feedback
Points Earned: 3.0/3.0
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