Reference no: EM132518538
Section A:
Suppose that Kevin is a 10 years old boy. He is at the mall with his mom, and she gives him some money to get food from the food court. At the food court there is a hamburger place, and an ice cream shop.
In the following table, I will show you Kevin's Total Utility for each quantity of Hamburgers and ice cream.
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'Hamburgers ($2) Ice Cream ($1)
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Quantity Total Utility Marginal Utility MU/PQuantity Total Utility Marginal Utility MU/P
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0 0 - -0 0 - -
1 20 1 29
2 34 2 46
3 44 3 53
4 47 4 55
5 47 5 56
6 42 6 56
7 32 7 52
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1) Complete the table, showing the Marginal Utility for each hamburger and ice cream. (for example, the first hamburger gives Kevin the marginal utility of 20, and the second gives him the marginal utility of 14.
2) Complete the table, showing the Marginal Utility Per Dollar of each hamburger and Ice Cream (ex. the first hamburger gives Kevin a marginal utility of 20, but costs $2, so the MU/P = 10).
3) Suppose that Kevin's mom gives Kevin $7 to spend in the food court. Please show me where kevin spends his money. (i.e. What does he buy first, second, third) and what his Total Utility is after each purchase.
Section B:
You own a yogurt shop.
1) The inputs to the production of frozen yogurt are: 3 machines, refrigerators, frozen yogurt mix, cups, sprinkles, workers.
What are the fixed inputs, and which are variable?
2) Complete the table: Wages per worker are $80, other variable input costs are $0.50 per cup, and Fixed Costs are $100.
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Cup of
FroYo
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Workers
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Labor
Cost
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Other
Variable
Input
Cost
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Variable
Cost (VC)
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Total
Cost (TC)
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Average
Fixed
Cost
(AFC)
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Average
Variable
Cost
(AVC)
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Average
e Total
Cost
(ATC)
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Marginal
Cost
(MC)
|
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0
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0
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110
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1
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200
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2
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270
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3
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300
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4
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320
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5
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330
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6
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Attachment:- CLASS DISCUSSION.rar