Economics - Homework Assignment

Please fill in the missing data for the blank lines (#8) on the graph and then questions below.

Output (Instructional Modules per Month)	Fixed Costs	Variable Costs	Total Cost	Average Fixed Cost	Average Variable Cost	Average Total Cost	Marginal Cost
0	$1080	0	$1080	0	0	0
1	$1,080	$ 400	$1,480	$1080	$400	$1480	$400
2	$1,080	$850	$1930	$540	$425	$965	$450
3	$1,080	$1,350	$2,430	$450	$810	$1260	$500
4	$1,080	$1900	$2980	$270	$475	$745	$550
5	$1,080	$2,500	$3580	$216	$500	$716	$600
6	$1,080	$3200	$4,280	$180	$533.33	4713.33	$700
7	$1,080	$4,100	$5180	$154.28	$585.71	$739.99	$900
8	$1,080			$135
9	$1,080	$7,300	$8380	$120	$811.11	$931.11
10	$1,080	$8720	$980	$108	$980	$1088.00	$1420

Do these look like they should? Is this table describing the short run or the long run? How do you know?

2. Graph the budget line and add the indifference curve for the following situation>

Assumptions: You have a $90 budge

Cost of Pillow is $15

Cost of Shoes is $45

Cost for shoes changse to $30

Hint: You must spend 1/2 of the budget on each.

Also, graph the demand curve based on the above information. Make sure that you explain what is going on in each graph - using words.

Answers

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