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$ 8 300
$ 6 700
$ 4 1300
$ 2 2200
(a.) (15 points) Is demand elastic or inelastic in the $6-$8 price range?
How do you know?
(b.) (15 points) If the table represents the demand faced by a monopoly
firm, then what is that firm’s marginal revenue as it increases output
from 1300 units to 2200 units? Show all work. (Be careful here!)
3.
Question :
(TCO C) You have been hired to manage a small manufacturing facility
whose cost and production data are given in the table below.
Total Total
Workers Labor Cost Output Revenue
1 $500 100 $700
2 1000 280 1150
3 1500 440 1440
4 2000 540 1570
5 2500 600 1670
6 3000 630 1710
7 3500 640 1730
(a.) (6 points) What is the marginal product of the second worker?
(b.) (6 points) What is the marginal revenue product of the fourth
worker?
(c.) (6 points) What is the marginal cost of the first worker?
(d.) (12 points) Based on your knowledge of marginal analysis, how
many workers should you hire? Explain you answer.
4.