• Small convenience stores, which often open 7 days a week and even 24 hours a day, typically charge higher prices than supermarkets. Why? Assuming both stores are maximizing their profits, make an economic argument drawing on monopoly power and markup pricing.

• Digging trenches requires two types of labor: unskilled labor (aka workers) and skilled labor (aka supervisors). Unskilled labor can be hired for $40 per day, and skilled labor can be hired for $80 per day. If, by hiring another unskilled laborer, K&B Construction Company can dig another 20 feet of trenches per day, and if by hiring another skilled laborer, it can dig another 30 feet of trenches per day, is K&B Construction Company minimizing its costs? If not, what adjustments are called for to improve the efficiency in resource use?