Complete the following problems in the space provided. Remember to label axes on graphs and list units for all answers as appropriate. PS1 is due at the beginning of class on Thursday 2/8.\ Marginal Analysis (5 points)\ After going through our farmers market practice problem, you decide to start a vegetable garden in your backyard. You can sell tomatoes at a local farmer's market for

$4.00

per pound.\ Adding compost to your garden will increase your yield (and by extension, your revenue), but will also add additional costs. The best quality compost costs

$6

per pound, and your estimates of total yield for each amount of compost are shown to the right.\ a. Calculate the marginal benefit (revenue, in dollars) of each pound of compost and enter your answers in the table.\ Hint: find marginal revenue by multiplying the additional pounds of tomatoes by the price per pound.\ b. What is the marginal cost of\ \\\\table[[\\\\table[[Pounds of],[Compost]],\\\\table[[Pounds of],[Tomatoes]],\\\\table[[Additional],[pounds of],[tomatoes]],\\\\table[[Marginal],[Revenue ($)]]],[0,30,--,--],[1,45,,],[2,57,,],[3,65,,],[4,70,,],[5,72,,]]\ each pound of compost?\ c. Using marginal analysis, and assuming that your goal is to maximize profit, how many pounds of compost should you add? Explain briefly.

Complete the following problems in the space provided. Remember to label axes on graphs and list units for all answers as appropriate. PS1 is due at the beginning of class on Thursday 2/8. 1) Marginal Analysis (5 points) After going through our farmers market practice problem, you decide to start a vegetable garden in your backyard. You can sell tomatoes at a local farmer's market for $4.00 per pound. Adding compost to your garden will increase your yield (and by extension, your revenue), but will also add additional costs. The best quality compost costs $6 per pound, and your estimates of total yield for each amount of compost are shown to the right. a. Calculate the marginal benefit (revenue, in dollars) of each pound of compost and enter your answers in the table. Hint: find marginal revenue by multiplying the additional pounds of tomatoes by the price per pound. b. What is the marginal cost of each pound of compost? c. Using marginal analysis, and assuming that your goal is to maximize profit, how many pounds of compost should you add? Explain briefly