Concept explainers
(a)
To find: Sam's
(b)
To find Sam's opportunity cost of making one melon appetizer.
(c)
To find Sam's opportunity cost of making one mini sandwich if she has an extra four hours to prepare.
(d)
To find Sam's opportunity cost of making one melon appetizer if she has an extra four hours to prepare.
(e)
To find Sam's opportunity cost of making one mini-sandwich if Sam's friend Chris helps by preparing the melon slices, increasing Sam's productivity to 300 mini-sandwiches or 300 melon appetizers per hour.
(f)
To find Sam's opportunity cost of making one melon appetizer if Sam's friend Chris helps by preparing the melon slices, increasing Sam's productivity to 300 mini-sandwiches or 300 melon appetizers per hour.
Want to see the full answer?
Check out a sample textbook solution- Use the data in the following graph to illustrate the law of increasing costs numerically. (Hint: Start at point E and move toward point A.) A 180 C D 150 120 90 60 30 30 60 90 120 150 180 Units of digital cameras Moving from point E toward point A, we give up (Click to select) v players. amounts of digital cameras for each gain of (Click to select) V DVD The opportunity cost of moving from: E to D is (Click to select) v digital cameras; D to C, (Click to select) V digital cameras; C to B, (Click to select) V digital cameras; and B to A, (Click to select) digital cameras. Units of DVD playersarrow_forwardMichael owns a strawberry farm in central California and is deciding how many strawberries to supply this month. Which question appropriately applies the cost-benefit principle to the supply decision? Is the price Michael gets for the extra bushel of strawberries at least as large as the marginal cost? What is the fixed cost of production for Michael's strawberries? If Michael was not producing strawberries, how else could he use his resources? Is Michael "holding all else constant" when making this decision?arrow_forwardNot a previously graded question. Becky is a talented artist who sells hand-crafted goods on her website. Becky currently crafts and sells both picture frames and pillows. She spends 8 hours a day working on crafts. The following table gives different daily output scenarios depending on how much of her time is spent on each good.arrow_forward
- Felix is a skilled toy maker who is able to produce both boats and balls. He has 8 hours a day to produce toys. The following table shows the daily output resulting from various possible combinations of his time. On the following graph, use the blue points (circle symbol) to plot Felix's initial production possibilities frontier (PPF). Suppose Felix is currently using combination D, producing one boat per day. His opportunity cost of producing a second boat per day is (1,2,16 0R 18) per day. Now, suppose Felix is currently using combination C, producing two boats per day. His opportunity cost of producing a third boat per day is (1,6,10 OR 16) per day. From the previous analysis, you can determine that as Felix increases his production of boats, his opportunity cost of producing one more boat (DECREASE, INCREASED OR REMAINS CONSISENT) . Suppose Felix buys a new tool that enables him to produce twice as many boats per hour as before, but it doesn't affect…arrow_forwardKatie loves swimming. Every afternoon, she visits the local swimming pool for a swim. The entry cost to the pool costs Katie $10 but she can swim for as long as she wants. Once she has entered the pool and paid the fee, Katie wonders how many hours should she spend swimming if she were to think like an economist. She expects to gain an incremental benefit of $21 from the first hour of swimming, then gains subsequent incremental benefits of $17 from the second, $11 from the third and $4 from the fourth. For every hour spent swimming, it will cost Katie $6 as she could have spent the time doing her homework. In determining how many hours Katie should be swimming, the $10 entry fee to the pool is a/an Type A for Average cost, M for Marginal cost, S for Sunk cost or O for Opportunity cost. Using marginal analysis, what is the optimal amount of hours Katie should spend swimming? The maximum surplus for Katie, from spending the number of hours you found in part b, is $ Answer to the nearest…arrow_forwardEvery Friday night, Gustavo pays $49.99 to eat nothing but crab legs at the all-you-can-eat seafood buffet at the M Resort in Las Vegas. On average, he consumes 34 crab legs each Friday. The average cost of each crab leg to Gustavo is $1.47 The marginal cost of an additional crab leg is $.arrow_forward
- Every Friday night, Gustavo pays $49.99 to eat nothing but crab legs at the all-you-can-eat seafood buffet at the M Resort in Las Vegas. On average, he consumes 34 crab legs each Friday. The average cost of each crab leg to Gustavo is $1.47 The marginal cost of an additional crab leg is $.arrow_forwardWhat is the difference between the Budget Constraint and Production Possibilities Frontier? How do you calculate the Opportunity Cost under each one?arrow_forwardDefine opportunity cost. What is your opportunity cost for attending a class at 11:00 am? How does it differ from your opportunity cost of attending a class at 8:00 am?arrow_forward
- What is opportunity cost? Explain the Law of Increasing Opportunity Costs with a numerical table and a graph as well.arrow_forwardFor the annual school bazaar, Emmy can produce and sell either origami frogs (F) or birds (B). For his origami he needs to work with sheets of paper, glue, and paper clips. Below table shows how many units of each input factor is needed to produce one origami. It also shows the total amount of input units available. Emmy’s profits per origami bird and frog are =1 and =2, respectively. 1:Which formula describes the sheets of paper constraint? a F <= 5 b F <= 6-2/3B c B <= 5 d F <=7-1B 2: Which formula describes the glue constraint? a F <=7-1B b F <= 5 c B <= 5 d F <= 6-2/3B 3: Which formula describes the paper clips constraint? a B <= 5 b F <=7-1B c F <= 6-2/3B d F <= 5 4: The iso-profit line has a slope of negative a…arrow_forwardSuppose Ireland produces only two goods: barley and cars. The following graph shows Ireland's current production possibilities frontier (PPF), along with six output combinations represented by black points (plus symbols) labeled A to F. 100 80 メ8 PPF 46, 36 40 メイ 20 20 40 60 80 BARLEY (Millions of bushels) 100 CARS (Millions) etarrow_forward