Question 1

Use the following demand schedule to calculate total revenue. For each price, indicate whether the demand is elastic, unit elastic or inelastic.

Table- Demand Schedule

Price ($)	Quantity demanded	TR ($)	Price elasticity of demand
5.0	0
4.5	4
4.0	8
3.5	12
3.0	16
2.5	20
2.0	24
1.5	28
1.0	32
0.5	36
0.0	40

Question 4

a. Using the table, construct the cost schedule for a firm operating in the short run.

b. Graph the average variable cost, average total cost and marginal cost curves.

Table- Total, Marginal and Average Costs

Total product (Q)	Total fixed cost (TFC)	Total variable cost (TVC)	Total cost (TC)	Marginal cost (MC)	Average fixed cost (AFC)	Average variable cost (AVC	Average total cost (ATC)
0	$50	$0	$50
1			70
2			85
3			95
4			100
5			110
6			130
7			165
8			215
9			275