1. ECO 550 Week 3 Chapter Questions
Click this link to get the tutorial:
http://homeworkfox.com/tutorials/economics/4263/eco-550-
week-3-chapter-questions/
Week 3 Chapter 5 Question 10
10. [Requires calculus] A perfectly competitive firm faces a market price of $10 for
its output X. It owns two plants, A and B, whose total costs are
+ 2X + :25X2
+ :4X + :1X2.
How many units should each plant produce to maximize profit at that price?
Week 3 Chapter 6 Question 5
5. Give a numerical example to show that a monopolist’ s marginal revenue can be
upward-sloping over part of its range. Hint: The price on the demand curve is the
producer’s average revenue. Think of the graphic in Chapter 4 that showed the possibility
of declining average costs while marginal costs were increasing.
Week 3 Chapter 6 Question 14
14. A monopolist has two types of customers. There are 100 of Type A, who will each pay
up to $10 for a single unit of the good, and 50 of Type B, who will each pay up to $8.
Neither is willing to purchase additional units at any price. If it must charge a uniform
price, find that price.