ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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Answer the next 6 questions using the following marginal benefit (MB) and marginal cost (MC) functions for activity A:
MB1 200 - 20A and MC = 500 + 30A
and the following total benefit (TB) and total cost (TC) functions:
TB = 1 200A- 10A² and TC = 500A + 15A²
1 - Undertaking the 10th unit of the activity A
2- Undertaking the 20th unit of the activity A
3- The optimal level of activity A* is 14
increases
5 - Eliminating the 25th unit of the activity
Total Cost by
decreases
4- At the optimal activity level of A*, Net Benefit is equal to
6 - What level of activity maximizes TOTAL Benefit?
Net Benefit by 200
Net Benefit by 300
A
Total Benefit by
and
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Transcribed Image Text:Answer the next 6 questions using the following marginal benefit (MB) and marginal cost (MC) functions for activity A: MB1 200 - 20A and MC = 500 + 30A and the following total benefit (TB) and total cost (TC) functions: TB = 1 200A- 10A² and TC = 500A + 15A² 1 - Undertaking the 10th unit of the activity A 2- Undertaking the 20th unit of the activity A 3- The optimal level of activity A* is 14 increases 5 - Eliminating the 25th unit of the activity Total Cost by decreases 4- At the optimal activity level of A*, Net Benefit is equal to 6 - What level of activity maximizes TOTAL Benefit? Net Benefit by 200 Net Benefit by 300 A Total Benefit by and
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