4.For each of the pairs

4.For each of the pairs
of goods listed in column A write in the correct cross price elasticity from
column Bn into the Answer Column.Each
cross price elasticity in B is used exactly once.This is a matching question,you are trying to match
the pairs of goods with the correct cross price elasticity from column
B.(5 pts)
Column
A Answer Column
B
Total and Wheaties
Cereal 0
Captain Crunch and
Oatmeal -.18
Tires and Peanut
Butter -1.2
Cereal and
Sugar .9
X Box and X Box
Games 1.5
5.Use the information
below to calculate a price elasticity of supply.You must show your work receive credit for
this problem.Once you have calculated
the price elasticity of supply,state whether it is elastic or inelastic.Given the elasticity you calculated,fill in
the blank in the following sentence:A
1% increase in price will cause a _________ percent increase in quantity
supplied.(5
pts)
Price Quantity
Supplied
4.00 15.00
6.00 45.00
======
PROBLEM ONE - Using the information in data set one,which I have
included in the table below,recalculate total cost,fixed cost,variable cost,
marginal cost,average total cost,average variable cost and average fixed costs
if the price of the fixed input (the small stores rent) is not $200 but
$240.A new lease may have caused the
rent to increase.I have created Table 1
for you to put your answers in.Assume
the price of the variable input,labor,is still $50 per unit.When fixed costs change which other costs
will increase?Compare the costs you
calculate for table one to the costs calculated in the notes in chapter 7 to
find the answer.
TABLE
ONE FOR ANSWERS TO PROBLEM ONE
Units of
Labor Total
Product(output) FC VC TC
MC ATC AVC AFC
0 0
1 3
2 7
3 12
4 16
5 19
6 21
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