I am at a loss at how to approach this math. I don't understand the steps to solve. If even the first equation was made clear to me I might be able to proceed. WPS OfficeFileEditView InsertFormatToolsTablesWorkspace Window Help86% (4)Sun 9:59 PMLOVE LEA...1-1.pptxP Dynamic.19A.pdfP Dynamics..Fa15.pdfOW Dynamic...H2.docxLOVE LEA...1-2.pptxOHomeMenu|PDFHomeInsertPage LayoutReferencesMailingsReviewViewSectionToolsLx CutCalibri (Body)14A* ATtAаBьСcDd AaBЬ AaBbC AaBbСоL CopyBIX² Xz AabNormalHead...Head...Head...Paste vFormatNew Style -Find andSeReplaceDynamic Allocation of Resources (Show all your work)Name (Print):Course:Part 1.Q#1. Use the following equations to graph the MB and MC curves.MB = 40 – .4q1МС - 10403530252015105102030405060708090100Q#2. Suppose there is a finite amount of this resource available, Q = 100.How many units of this resource will be used/consumed in period 1?Page Num: 1Page: 1/4Section: 1/1Row: 1Column: 1Words: 511Spell CheckBacking up口目100 %Submit Questioncount!Questions are typically answered in as fast as 30 minutes*Privacy - Terms.. WPS OfficeFileEditView InsertFormatToolsTables WorkspaceWindowHelp87% (4)Sun 9:59 PMLOVE LEA...1-1.pptxP Dynamic.19A.pdfP Dynamics..Fa15.pdfOW Dynamic...H2.docxLOVE LEA...1-2.pptxOHomeMenu|PDFHomeInsertPage LayoutReferencesMailingsReviewViewSectionToolsLx CutCalibri (Body)14A* ATtAaBbCcDd AABB AaBbC AaBbCcL CopyBI UrAr X? Xx Ar abzNormalHead...Head...Head...Paste vFormatNew Style -Find andSeReplaceSolve algebraically for how many units will be consumed in period 1.Part 2.Q#4. Suppose period 2 is just like period 1. Use the following equations to graph the MB and MC curves.MB = 40 – .4q2МС - 10403530252015105102030405060708090100Q#5. How many units will be used in period 2?(Remember that any units used in period 1 cannot be used in period 2).Q#6. Estimate the value of welfare for period 2? Show your work.Page Num: 1Page: 1/4Section: 1/1Row: 1Column: 1Words: 511Spell CheckBacking up100 %Submit Questioncount!Questions are typically answered in as fast as 30 minutes*Privacy - Terms..

Part 1 1. The Marginal benefit (MB) curve is downwards sloping because as quantity increases, the benefit derived from an extra unit declines. The marginal cost (MC) curve is upwards sloping as cost increases with increases in quantity. To plot the MB curve, firstly put q1= 0, then find the value of MB, and put that value on the vertical axis. MB= 40 – 0.4 (0) MB= 40 Secondly, put MB= 0, then find the value of q1, and put that value on the horizontal axis. 0 = 40 – 0.4 (q1) q1 = 100 Join both points on both axes to get MB curve. Since MC is constant, it will be a horizontal line to the x-axis at 10. The vertical axis indicates MC, MB and price. The horizontal axis indicates the quantity in period 1 (q1). 2. The total quantity of resource = Q = 100 To find the quantity of resource used in period 1, we need to equate MB and MC. MB = MC 40 – 0.4 q1= 10 0.4 q1 = 30 q1 = 75 So, 75 units of resource used in period 1. Part 2 4. To plot the MC and MB curve follow steps stated in answer1. The vertical axis indicates MC, MB and price. The horizontal axis indicates the quantity in period 2 (q2). 5. Q = 100 So, the sum of the quantity of resource used in period 1 and the sum of the quantity of resource used in period 2 equal to 100. q1+q2 = 100 75 +q1= 100 q1= 25 Since we have already consumed 75 units in period 1, we can consume only 25 units of resource in period 2 which is shown by a vertical line at 25. MB at q2 = 25, MB = 40- 0.4(25) MB = 30 6. The total welfare in period 2 is shown by area A+B. Area A = 1/2 * (Maximum MB – MB at q1=25)* q1 = 1/2 * (40 – 30) *25 = 125 Area B = (MB at q1=25- MC)*q1 Area B = (30- 10)*25 Area B = 500 Total welfare = Area A + Area B = 125+500 = 625

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Q#1. Use the following equations to graph the MB and MC curves. MC = 10 MB = 40 - 4q1 40 35 30 25 20 15 10 10 20 30 40 50 60 70 80 90 100 Q#2. Suppose there is a finite amount of this resource available, Q = 100. How many units of this resource will be used/consumed in period 1?

Q#1. Use the following equations to graph the MB and MC curves. MC = 10 MB = 40 - 4q1 40 35 30 25 20 15 10 10 20 30 40 50 60 70 80 90 100 Q#2. Suppose there is a finite amount of this resource available, Q = 100. How many units of this resource will be used/consumed in period 1?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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