Questions related to microeconomics
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...re popular, the mounds of recycled materials returned. What graph best depicts these events on the market for recycled materials?
c. Price remained constant at P0. Supply shifted from S0 to S1, then demand shifted from D0 to D1.
Both curves shifted outward. Economic growth causes an outward shift in the demand curve, while the increased popularity of recycling caused an outward shift in the supply curve.
4. Refer to the table above. The marginal physical product of the sixth worker is _____ and the average product of six workers is _____. Remember to show your work.
b. 6; 15.
The MPP is the additional output generated by that worker. So when the sixth worker is added, output increases by 6 units. The average is the total divided by the number of workers, or 90/6.
5. Owen runs a delivery business and currently employs three drivers. He owns three vans that employees use to make deliveries, but he is considering hiring a fourth driver. If he hires a fourth driver, he can schedule breaks and lunch hours so that all three vans are in constant use, allowing him to increase deliveries per day from 60 to 75. It will cost an additional $75 per day to hire the fourth driver. The marginal cost per delivery of increasing output beyond 60 deliveries per day:
b. is $5.
Deliveries increase by 15 with the fourth driver. Dividing $75 by 15, we get $5 per extra delivery.
6. Refer to the graph above. The profits earned by the monopolistically competitive firm represented ...