Homework answers / question archive / 1)Antarctica produces only party to and frozen fish The table shows the marginal benefit and marginal cost schedules for frozen fish if Antarctica produces frozen fish, the marginal benefit from recenfish the marginal cost ofterents To achieve locative efficiency, Antarctica must the quantity of frozen fish produced Frorenih Marginal Marginal benefit cost packs of ice per pack of fish) 94 95 O A ce decrease Bethan increase OG is less than decrease OD diners 97 90 99 29 50 TO 4 2 4 10 20 77 2)Suppose consumer's preferences are given by acl-7 -1 u(cl) = + In(), 1-7 where c> 0 is consumption, 1 > 0 is leisure, a > 0, and ye (0,1)

1)Antarctica produces only party to and frozen fish The table shows the marginal benefit and marginal cost schedules for frozen fish if Antarctica produces frozen fish, the marginal benefit from recenfish the marginal cost ofterents To achieve locative efficiency, Antarctica must the quantity of frozen fish produced Frorenih Marginal Marginal benefit cost packs of ice per pack of fish) 94 95 O A ce decrease Bethan increase OG is less than decrease OD diners 97 90 99 29 50 TO 4 2 4 10 20 77 2)Suppose consumer's preferences are given by acl-7 -1 u(cl) = + In(), 1-7 where c> 0 is consumption, 1 > 0 is leisure, a > 0, and ye (0,1)

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1)Antarctica produces only party to and frozen fish The table shows the marginal benefit and marginal cost schedules for frozen fish if Antarctica produces frozen fish, the marginal benefit from recenfish the marginal cost ofterents To achieve locative efficiency, Antarctica must the quantity of frozen fish produced Frorenih Marginal Marginal benefit cost packs of ice per pack of fish) 94 95 O A ce decrease Bethan increase OG is less than decrease OD diners 97 90 99 29 50 TO 4 2 4 10 20 77

2)Suppose consumer's preferences are given by acl-7 -1 u(cl) = + In(), 1-7 where c> 0 is consumption, 1 > 0 is leisure, a > 0, and ye (0,1). The consumer's budget constraint is c= w(1 - 1) +-T, where w is the real wage rate, is the dividend income, T is lumpsum taxes. Assume that W, 7, T are all exogenous and 7-T0. 1. Define the marginal utility of consumption, MU, and of leisure, MU. 2. Given the utility function above, determine MU, and MU. 3. Define the marginal rate of substitution of leisure for consumption, MRS..? 4. Given your answer from part 2, determine MRS.C. 5. Assuming y = 0.5, solve for equilibrium quantities of (e*,1").

3)

According to marginal analysis, optimal decision-making involves

Select one:

a. Taking actions only if the marginal cost is zero

b. Taking actions whenever the marginal benefit is positive

c. Taking actions whenever the marginal benefit exceeds the marginal cost

d. All of the above

A 10 percent increase in the quantity of spinach demanded results from a 20 percent decline in its price. The price elasticity of demand for spinach is

Select one:

a. 20.0

b. 2.0

c. 10.0

d. 0.5

If a product has seasonal demand along the four quarters, and the annual demand is 8 Mn units with seasonality factor of 0.8, 1.1, 1.2 and 0.9 for the first quarter, second quarter, third quarter and fourth quarter respectively, then, its demand in the four quarters Q1, Q2, Q3 and Q4 respectively are

Select one:

a. 1.8 Mn, 2.1 Mn, 2.2 Mn and 1.9 Mn respectively

b. 1.4 Mn, 2.3 Mn, 2.6 Mn and 1.7 Mn respectively

c. None of the above

d. 1.6 Mn, 2.2 Mn, 2.4 Mn and 1.8 Mn respectively

The relationship between number of beers consumed (x) and blood alcohol content (y) was studied in 16 male college students by using least squares regression. The following regression equation was obtained from this study: y’= -0.0127 + 0.0180x. The above equation implies that

Select one:

a. each beer consumed increases blood alcohol by an average of amount of 1.8%

b. on average it takes 1.8 beers to increase blood alcohol content by 1%

c. each beer consumed increases blood alcohol by exactly 0.018

d. each beer consumed increases blood alcohol by 1.27%

A 20 percent increase in the quantity of pizza demanded results from a 10 percent decline in its price. The price elasticity of demand for pizza is

Select one:

a. 20.0

b. 0.5

c. 2.0

d. 10.0