Shirley has to choose between a 2-day trip and a 3-day trip to Hollywood. The table below shows the expected benefit and cost for the different days. Apply both optimization using total value and optimization using marginal analysis to determine what Shirley's optimum decision should be. Does the decision differ with the techniques used? Which technique is faster to implement? Day Cost Benefit 1 $750 $800 2 $900 $1,000 3 $600 $800

Shirley has to choose between a 2-day trip and a 3-day trip to Hollywood. The table below shows the expected benefit and cost for the different days. Apply both optimization using total value and optimization using marginal analysis to determine what Shirley's optimum decision should be. Does the decision differ with the techniques used? Which technique is faster to implement? Day Cost Benefit 1 $750 $800 2 $900 $1,000 3 $600 $800

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter17: Capital And Time

Section: Chapter Questions

Problem 17.6P

See similar textbooks

Similar questions

Ken’s firm is committed to reducing greenhouse gas by 10 tons per year. The firm’s cost of abating a ton of carbon is shown below: Quantity of Carbon Abated in tons Marginal Cost of Carbon Abatement 1 $3 2 $4 3 $5 4 $6 5 $7 6 $8 7 $9 8 $10 9 $11 10 $12 Ken also has the option to instead pay for a reforestation project that offsets a ton of carbon. Each reforestation project cost $7. What is the best combination of production abatement and reforestation abatement for Ken? How much money does Ken save byusing the reforestation abatement?
Your friend Claire has been designing her own hoodies and giving them as gifts to friends and family. She has decided to sell them online soon by using a 3rd party website with a service surcharge based on her pricing. Using the information below, what is the relationship between Claire's selling price per hoodie and profit margin? (Please plot a graph dipcting the relationship) Costs ($) Base Hoodie Cost $30 Craft Supplies to design $10 Selling Website Service Charge 5%
Ms. Beauty's incremental benefit per day from drinking soda is given in the following scenarios. She values the first soda she drinks at P120, the second at P115, the marginal benefit for 3 soda is P95 and finally the marginal benefit for 4 soda is P60. If the price of soda is P100, the optimal number of soda that Ms. Beauty should drink is: *
1. Identify the curve that represents the regular gasoline vehicle and hence determine the range of annual mileage for which it is the most economical of the three vehicle types. A. between 37,000 and 49,000 B. more than 49,000 C. less than 37,000 D. more than 37,000 E. less than 25,000 F. between 25,000 and 37,000 G. between 25,000 and 49,000 2. Identify the curve that represents the hybrid vehicle and hence determine the range of annual mileage for which it is the most economical of the three vehicle types. A. between 25,000 and 49,000 B. between 37,000 and 49,000 C. between 25,000 and 37,000 D. less than 37,000 E. more than 37,000 F. more than 49,000 G. less than 25,000
7 uppose the Queensland Government is considering a project where COVID vaccinations can be provided to the general public within a popular shopping centre. The project is expected to last 5 years, with an initial investment cost of $7,500. The ongoing cost of the project is $1,400 in rent and 7 casual workers who administer vaccinations for 60 hours each, per year at a minimum wage of $15/per hour. The opportunity cost of labour in the area is 40% of the minimum wage. The Government is considering charging $6.50 per vaccination and is expected to administer 1,400 vaccinations per year from this program. It has also been determined that the program will provide an external community benefit of $550 per year. If the appropriate discount rate is 6.5%, determine the following: a The NPV of market b The NPV of Social CBA c The IRR of MArket
Please no written by hand solution Kate recently invested in real estate with the intention of selling the property one year from today. She has modeled the returns on that investment based on three economic scenarios. She believes that if the economy stays healthy, then her investment will generate a 30 percent return. However, if the economy softens, as predicted, the return will be 10 percent, while the return will be -25 percent if the economy slips into a recession. If the probabilities of the healthy, soft, and recessionary states are 0.6, 0.2, and 0.2, respectively, then what are the expected return and the standard deviation of the return on Kate❝s investment? Calculate the coefficient of variation for this investment. (Round expected return to 3 decimal places, e.g. 0.125 and round intermediate calculations and standard deviation to 5 decimal places, e.g. 0.07680.)
Q) Larry was accepted at three different universities and must choose one. Elite U costs $50,000 per year and did not offer him any financial aid. He values attending Elite U at 60,000 per year. State College costs $30,000 per year, and offered Larry an annual $10,000 scholarship. Larry values attending State College at $40,000 per year. NoName U costs $20,000 per year, and offered him a full $20,000 annual scholarship. He values attending NoName at $15,000 per year. What is Larry's opportunity cost of attending Elite U? a. $15,000 b. $20,000 C. $50,000 d. $70,000 Explain it correctly
Q) Larry was accepted at three different universities and must choose one. Elite U costs $50,000 per year and did not offer him any financial aid. He values attending Elite U at 60,000 per year. State College costs $30,000 per year, and offered Larry an annual $10,000 scholarship. Larry values attending State College at $40,000 per year. NoName U costs $20,000 per year, and offered him a full $20,000 annual scholarship. He values attending NoName at $15,000 per year. What is Larry's opportunity cost of attending Elite U? a. $15,000 b. $20,000 C. $50,000 d. $70,000 Explain it early
Maria can purchase shirts for $22.00 each. She considers the benefit of one shirt to be $40.00, but with each additional shirt she purchases the benefit decreases by $5. According to the Principle of Optimization at the Margin, Maria will purchase..... shirts
4 with complete solution
If the cost of gasoline is $2.50 per gallon, how far out of your way (one way) could you afford to drive (in miles) to a service station that has gasoline at $2.25 per gallon if your vehicle gets 30 miles per gallon and you will fill up with 20 gallons of fuel? Consider only the cost of gasoline in vehicle driving cost. (Hint: Since you are going out of your way, you have to drive back the same distance.)
Note: Answer with 100% accuracy. And explain also. Please tell me why the option is wrong.