Ten villagers graze cows in a common field. It costs $10 to buy a c produces. With c cows grazing on the field, total value ("benefit") of their milk is 100c¹2 (hence the total value of milk per cow is 100cc). The total benefit is increasing in c (upward sloping) because each additional cow generates revenue (which goes to the villager who owns the cow) but the slope is decreasing c because for every additional cow in the field, there is less grass available for the other cows, who therefore won't produce as much milk. The marginal revenue ("benefit") per additional cow grazing on the field is 50c 12 a. How many cows should the village raise to maximize total profits (i.e., what is the optimal c*?)?
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- 4. Cost-benefit analysis A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus is be classified as a public good. and The benefit of the beautification initiative, as suggested by the survey, is 5 cost, the college administrators Suppose the college administrators estimate that the beautification initiative will cost $52,110. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 2,150 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $26. Thus, the visual appearance would undertake the beautification initiative. Because the estimated benefit is than the The calculation of the benefit of the beautification…Emmanuel likes gardening. He grows zucchini that he sells at the local farmers' market. The table below describes the benefits and costs Emmanuel faces as he decides how many hours to dedicate to his garden each week. a. Complete the "Marginal Benefit" and "Marginal Cost" columns in the table below. Emmanuel's Gardening Benefits and Costs Hours Spent Gardening Total Benefit (dollars) Marginal Benefit (dollars) Total Cost (dollars) Marginal Cost (dollars) 1 $21 $ $3 $ 2 39 9 3 54 18 4 66 30 5 75 45 6 81 63 7 84 844. Cost-benefit analysis A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus is be classified as a public good. The benefit of the beautification initiative, as suggested by the survey, is $ cost, the college administrators and Suppose the college administrators estimate that the beautification initiative will cost $8,000. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 370 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $16. ▼ undertake the beautification initiative. . Thus, the visual appearance would Because the estimated benefit is An equal number of male and female students were surveyed. The…
- 4. Cost-benefit analysis A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus is be classified as a public good. and The benefit of the beautification initiative, as suggested by the survey, is $ cost, the college administrators Suppose the college administrators estimate that the beautification initiative will cost $92,800. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 2,250 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $28. . Thus, the visual appearance would ▼ undertake the beautification initiative. Because the estimated benefit is than the The calculation of the benefit of the beautification…Emmanuel likes gardening. He grows zucchini that he sells at the local farmers' market. The table below describes the benefits and costs Emmanuel faces as he decides how many hours to dedicate to his garden each week. Emmanuel's Gardening Benefits and Costs Hours Total Benefit Spent Gardening (dollars) 1 $27 2 3 4 5 6 7 51 72 90 105 117 126 Marginal Benefit (dollars) Total Cost (dollars) $9 21 36 54 75 99 126 Marginal Cost (dollars) $ MO Instructions: Enter your answers as a whole number. Complete the "Marginal Benefit" and "Marginal Cost" columns in the table above. D 139. Cost-benefit analysis A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus is be classified as a public good. and The benefit of the beautification initiative, as suggested by the survey, is $ cost, the college administrators Suppose the college administrators estimate that the beautification initiative will cost $61,110. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 2,240 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $20. Thus, the visual appearance would undertake the beautification initiative. Because the estimated benefit is than the The calculation of the benefit of the beautification…
- Assuming that a problem is “convex,” net benefits are maximized when a. Producers select a level of production where internal benefits equal external costs. b. Producers select a level of production at which costs equal benefits. c. Producers engage in an activity up to the point where marginal benefit exceeds marginal cost. d. Producers engage in an activity up to the point where marginal benefit equals marginal cost. e. Producers engage in an activity up to the point where total average revenue exceeds total average cost.4. Cost-benefit analysis A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus is be classified as a public good. and . Thus, the visual appearance would Suppose the college administrators estimate that the beautification initiative will cost $47,270. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 3,060 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $28. The benefit of the beautification initiative, as suggested by the survey, is $ cost, the college administrators Because the estimated benefit is than the undertake the beautification initiative. The calculation of the benefit of the beautification…Allison has a golden goose that will lay an egg every year until forever. The first egg will be out next year, and each egg is worth $500. Allison's friend, Eric, offers a price to buy the golden goose from Allison today. The interest rate is 10%. From the cost-benefit analysis, under which of the following offers would Allison be willing to sell the goose to Eric? O A $4,500 B. $5.500 C. Allison would want to sell it to Eric with both $4,500 and $5.500. D. Allison wouldn't want to sell it anyway since the eggs would be laid out forever.
- The next 3 questions refer to the following figure, which shows marginal benefits (MB) and marginal cost (MC) of activity A. $ 16 14 12 10 8 6 4 2 50 100 150 0 Adding the 50th unit of activity causes net benefit to Subtracting the 200th unit of activity causes net benefit to 200 250 300 MC----- MB 350 by $ by $ A4. Cost-benefit analysis. A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. and Thus, the visual appearance would For the students of the college, the visual appearance of the campus is be classified as a public good. Suppose the college administrators estimate that the beautification initiative will cost $2,700. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 290 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $15. Because the estimated benefit is than the The benefit of the beautification initiative, as suggested by the survey, is $ cost, the college administrators ✓ undertake the beautification initiative. The calculation of the benefit of the beautification…4. Cost-benefit analysis A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus is and The benefit of the beautification initiative, as suggested by the survey, is undertake the beautification initiative. Suppose the college administrators estimate that the beautification initiative will cost $52,110. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 2,150 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $26. Thus, the visual appearance would be classified as a public good. An equal number of first, second, third, and fourth year students were surveyed. Students believe they will eventually be charged their…