Intermediate Microeconomics 8th edition Hal R. Varian - Solutions

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a. Calculate Sue's opportunity cost of producing a capb. Calculate Tessa's opportunity cost of producing .c. Who has a comparative advantage in producing caps?d. If Sue and Tessa specialize in producing the good in which they have a comparative advan- tage and then trade 1 jacket for 15 caps, who
Define marginal cost and calculate Brazil's mar- ginal cost of producing a tonne of food when the quantity produced is 2.5 tonnes per day.
Does Brazil face an increasing opportunity cost of producing ethanol? What feature of Brazil's PPF illustrates increasing opportunity cost?
a. If Brazil increases ethanol production from 40 barrels per day to 54 barrels a day, what is the opportunity cost of producing the additional ethanol?b. If Brazil increases food production from 2 tonnes per day to 3 tonnes per day, what is the opportunity cost of producing the addi- tional
a. Draw a graph of Brazil's PPF and explain how your graph illustrates scarcity.b. If Brazil produces 40 barrels of ethanol a day, how much food must it produce to achieve pro- duction efficiency?c. Why does Brazil face a tradeoff on its PPF?
Suppose that Leisure Island produces 4 shows and 12 meals a week. Calculate the opportunity cost of producing 2 additional shows a week.
If Leisure Island produces 8 shows and 5 meals a week, do the people of Leisure Island face a tradeoff?
If Leisure Island produces 4 shows and 9 meals a week, is production efficient?
Can Leisure Island produce 4 shows and 14 meals a week?
List all the influences on selling plans, and for cach influence, say whether it changes supply.
Use the demand and supply model to make predictions about changes in prices and quantities
Disney Hopes Wall Street Bets on New Global Streaming Service Walt Disney Co. unveiled details of a family- friendly streaming service on Thursday with TV shows and movies from some of the world's most popular entertainment franchises. Disney says its new streaming service, Disney Plus, will cost
After you have studied Economics in the News on pp. 50-51, answer the following questions.a. How does the deal between B.C. and the Fort Nelson First Nation change the Fort Nelson economy's PPF in 2021?b. How would a technological advance in geo- thermal energy production change the Fort Nelson
On a graph of the circular flows in the market economy, indicate the real and money flows in which the following items belonga. You buy an iPad from the Apple Store.b. Apple Inc. pays the designers of the iPad.c. Apple Inc. decides to expand and rents an adjacent buildingd. You buy a new e-book
Sketch SpaceX's PPF for trips to the Inter- national Space Station and other goods and ser- vices and show its planned production in 2021.
and 23. SpaceX will Send Three Tourists to the International Space Station Next Year SpaceX will send three tourists on a 10-day trip to the International Space Station sometime in late 2021. Source: The Verge, March 5, 2020 22 What is the opportunity cost of creating the technology for trips to
Capital accumulation and technological change bring economic growth: Production that was unattainable yesterday becomes attainable today; production that is unattainable today will become attainable tomorrow. Why doesn't eco- nomic growth bring an end to scarcity? Use the following data to work
Tony and Patty produce skis and snowboards. The tables show their production possibilities. Each week, Tony produces 5 snowboards and 40 skis; Patty produces 10 snowboards and 5 skis. Tony's Production Possibilities Snowboards Skis (units per week) (units per week) 15 10 285040 and 0 and 10 and
a. Draw a graph of Kim's PPF and Liam's PPF and show the point at which each produces when each spends 30 minutes of each hour producing pies and 30 minutes producing cakes.b. On your graph, show what Kim produces and what Liam produces when they specialize.c. When they specialize and trade, what
a. Calculate Kim's opportunity cost of producing a pie and Liam's opportunity cost of produc- ing a pie.b. If each spends 30 minutes of each hour pro- ducing pies and 30 minutes producing cakes, how many pies and cakes does each produce?c. Who has a comparative advantage in produc- ing (i) pics and
Make a graph with the percentage of malaria cases eliminated on the x-axis and the marginal cost and marginal benefit of driving down malaria cases on the y-axis. On your graph: (1) Draw curves to show the marginal cost and the marginal benefit of malaria eradication. (ii) Identify the quantity of
Does the report describe production efficiency or al- locative efficiency or both?
Hudson's Bay Closing Brick-and-mortar Stores As more people choose online shopping, the Bay has been closing brick-and-mortar stores. Source: National Post, September 13, 2019a. Draw the PPF curves for brick-and mortar retailers and online retailers before and after the Internet became available. L
The table describes the preferences in Yucatan. Sunscreen (litres per day) 25 75 125 Willingness to pay (kilograms of food per litre) 3 21a. What is the marginal benefit of sunscreen and how is it measured?b. Using the table in Problem 11, what does Yucatan produce to achieve allocative efficiency?
In Problem 11, what is the marginal cost of 1 kilogram of food in Yucatan when the quantity produced is 150 kilograms per day? What is spe- cial about the marginal cost of food in Yucatan?
a. Draw a graph of Yucatan's PPF and explain how your graph illustrates a tradeoff.b. If Yucatan produces 150 kilograms of food per month, how much sunscreen must it pro- duce if it achieves production efficiency?c. What is Yucatan's opportunity cost of produc- ing 1 kilogram of food and (ii) 1
For 50 years, Cuba has had a centrally planned economy in which the government makes the big decisions on how resources will be allocated.a. Why would you expect Cuba's production pos- sibilities (per person) to be smaller than those of Canada?b. What are the social institutions that Cuba might
A farm grows wheat and produces pork. The mar- ginal cost of producing each of these products increases as more of it is produced.a. Make a graph that illustrates the farm's PPF.b. The farm adopts a new technology that allows it to use fewer resources to fatten pigs. On your graph, sketch the
Suppose that Tessa buys a new machine that enables her to make 20 jackets an hour. (She can still make only 80 caps per hour.)a. Who now has a comparative advantage in pro- ducing jackets?b. Can Sue and Tessa still gain from trade?c. Would Sue and Tessa still be willing to trade 1 jacket for 15
a. Calculate Sue's opportunity cost of producing a capb. Calculate Tessa's opportunity cost of producing .c. Who has a comparative advantage in producing caps?d. If Sue and Tessa specialize in producing the good in which they have a comparative advan- tage and then trade 1 jacket for 15 caps, who
Define marginal cost and calculate Brazil's mar- ginal cost of producing a tonne of food when the quantity produced is 2.5 tonnes per day.
1a. Draw a graph of Brazil's PPF and explain how your graph illustrates scarcity.b. If Brazil produces 40 barrels of ethanol a day, how much food must it produce to achieve pro- duction efficiency?c. Why does Brazil face a tradeoff on its PPF?2a. If Brazil increases ethanol production from 40
Suppose that Leisure Island produces 4 shows and 12 meals a week. Calculate the opportunity cost of producing 2 additional shows a week.Ethanol (barrels per day) Food crops (tonnes per day) 0 7122070 and 64 and 54 and 40 and 22 and and 123452 4
If Leisure Island produces 8 shows and 5 meals a week, do the people of Leisure Island face a tradeoff?
If Leisure Island produces 4 shows and 9 meals a week, is production efficient?
Can Leisure Island produce 4 shows and 14 meals week? a
Why do specialization and the gains from trade make the economy's PPF bow outward?
How does the marginal benefit of a good change as the quantity consumed of that good increases?
Describe the economic institutions that coordinate decisions
Explain how current production choices expand future production possibilities, change what we produce, and destroy and create jobs
Explain how specialization and trade expand production possibilities
Define the production possibilities frontier and use it to calculate opportunity cost
What happens in the graph in Problem if the rainfall increases from 200 mm to 400 mm?
What happens in the graph in Problem 21 if the price rises and rainfall is constant?
Draw a graph to show the relationship between the price and the number of umbrellas purchased, holding the amount of rainfall constant at 200 mm. Describe this relationship.
to 17. Draw a graph that shows the relationship between the two variables x and y x 0 12 3 4 5 25 24 22 1812 0 y 15a. Is the relationship positive or negative?b. Does the slope of the relationship become steeper or flatter as the value of x increases?c. Think of some economic relationships that
Draw a scatter diagram of the quantity of oil produced and the quantity of gasoline refined. Describe the relationship. Use the following data to work Problems
Draw a scatter diagram of the price of gasoline and the quantity of gasoline refined. Describe the relationship.
Draw a scatter diagram of the price of oil and the quantity of oil produced. Describe the relationship.
What happens in the graph in Problem 10. if the temperature rises to 30C?
Draw a graph to show the relationship between the price and the number of rides when the tem- perature is 20C. Describe this relationship.
and 11. The table gives the price of a balloon ride, the tem- perature, and the number of rides a day. Balloon rides Price (dollars per (number per day) ride) 10C 20C 30C
Calculate the slope across the are AB. Use the following table to work Problems
between 3,175 and 4,406 theatres.
Calculate the slope of the relationship in Problem
between 3,308 and 4,134 theatres
Calculate the slope of the relationship in Problem
Draw a graph of the relationship between the revenue per theatre on the y-axis and the num- ber of theatres on the x-axis. Describe the relationship
Draw a scatter diagram of the growth rate and unemployment rate. Describe the relationship.
Explain what change will bring a shift of a curve. Work these questions in Study Plan 1A and get instant feedback. MyLab Economics
Which of the relationships in Questions and is a positive relationship and which is a negative relationship?
Draw a graph of two variables whose relation- ship shows (a) a maximum and (b) a minimum.
Explain how we "read" the three scatter diagrams in Figs. A1.3 and A1.4.
Explain how we "read" the two graphs in Figs. A1.1 and A1.2.
What might be an incentive for you to take a class in summer school? List some of the ben- efits and costs involved in your decision. Would your choice be rational? Economics as Social Science and Policy Tool 12 Look at today's National Post. What is the lead- ing economic news story? Which big
How does a successful movie illustrate self-inter- ested choices that are also in the social interest? The Economic Way of Thinking
Swifties, Rejoice! Taylor Swift Will Perform a Free JamFest Concert in Atlanta Calm down, Swifties! Taylor Swift will headline a free concert at the Capital One JamFest, April 5! Source: USA Today, November 8, 2019 When Taylor Swift performs at JamFest, what is free and what is scarce? Explain your
Which of the following statements is posi- tive, which is normative, and which can be tested?a. Canada should cut its imports.b. China is Canada's largest trading partner.c. If the price of gasoline rises, people will drive less and use less gasoline.
Olympics Could Cost More Than $26 Billion Japanese media estimate that overall spending on Japan's new venues, including an expensive national stadium and athletes' village, is between $26 billion and $28 billion. Source: Los Angeles Times, December 20, 2019 What is Japan's opportunity cost of
Explain how the following news headlines concern self-interest and the social interest.a. Walmart Builds 500 New Stores in Chinab. Amazon Will Deliver Groceries for Freec. Food Must Be Labelled with Nutrition Data
Why might it not be in the social interest for everyone to get online?
Why might it be in Mark Zuckerberg's self-interest to get everyone online?
Why don't more people make the tradeoffs needed to get online?
What are some of the things that might be forgone for more people to get online?
What is the fundamental economic problem and how does this news clip illustrate it?
What is a model? Can you think of a model that you use in your everyday life?
Describe the broad facts about what, bow, and for whow goods and services are produced.
Did any of the decisions harm the social interest?
Whose decisions turned out to be in the social interest?
Whose decisions in the story were taken in self-interest?
Describe the jobs available to the graduates of a major in economics
Explain how economists go about their work as social scientists and policy advisers
Explain the two big questions of economics
A firm has two variable factors and a production function f(x1, x2) = √(2x1 + 4x2). On the graph below, draw production isoquants corresponding to an output of 3 and to an output of 4.If the price of the output good is 4, the price of factor 1 is 2, and the price of factor 2 is 3, find the
If two goods are perfect substitutes, what is the demand function for good 2?
Which of the following utility functions have the expected utility property(a) u(c1, c2, π1, π2) = a(π1c1 + π2c2), (b) u(c1,c2, π1,π2) = π1c1 + π2c2,(c)u(c1, c2, π1,π2) = π1lnc1 + π2lnc2 + 17.
How would your answer to the last problem change if the worker’s alter-native employment gave him u̅ = 1?
Given the setup of the previous problem, what would the worker be willing to pay to rent the production technology?
A worker can produce x units of output at a cost of c(x) = x2/2. He can achieve a utility level of u̅ = 0 working elsewhere. What is the optimal wage-labor incentive schemes(x) for this worker?
In the same model, how much consumers’ surplus would be created by randomly assigning buyers to sellers? Which method gives the larger surplus?
Consider the model of the used-car market presented in this chapter. What is the maximum amount of consumers’ surplus that is created by trade in the market equilibrium?
Cowflop, Wisconsin, has 1,000 people. Every year they have a fireworks show on the Fourth of July. The citizens are interested in only two things—drinking milk and watching fireworks. Fireworks cost 1 gallon of milk per unit. People in Cowflop are all pretty much the same. In fact, they have
Ten people have dinner together at an expensive restaurant and agree that the total bill will be divided equally among them.(a) What is the additional cost to any one of them of ordering an appetizer that costs $20? $2.(b) Explain why this maybe an inefficient system.
Suppose that 10 people live on a street and that each of them is willing to pay $2 for each extra streetlight, regardless of the number of streetlights provided. If the cost of providing x streetlights is given by c(x) = x2, what is the Pareto efficient number of streetlights to provide?
Suppose that demand for DoorKnobs is as given in the previous problem, and assume that the perceived market share in any period is equal to the actual market share in the previous period. Then where xt is the actual market share in period t, the equation p = 256xt − 1 (1 − xt) is
Suppose that the marginal cost of producing an extra video is zero and the transactions cost of renting a video is zero. Does a producer make more money by selling the video or by renting it?
Describe how the demand for a word processing package might exhibit network externalities.
If the cost to a customer from switching long-distance carriers is on the order of $50, how much should a long-distance carrier be willing to pay to acquire a new customer?
Suppose that the government wants to control the use of the commons, what methods exist for achieving the efficient level of use?
List some other examples of positive and negative consumption and production externalities.

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Intermediate Microeconomics 8th edition Hal R. Varian - Solutions

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