Principles of Microeconomics (MindTap Course List)
8th Edition
ISBN: 9781305971493
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Chapter 17, Problem 6PA
Subpart (a):
To determine
Payoff matrix of classmates.
Subpart (b):
To determine
Payoff matrix of classmates.
Subpart (c):
To determine
Payoff matrix of classmates.
Subpart (d):
To determine
Payoff matrix of classmates.
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You and a classmate are assigned a project on which you will receive one combined grade. (You each want to receive a good grade, but you also want to avoid hard work. In particular, here is the situation:• If both of you work hard, you both get an A, which gives each of you 40 units of happiness.• If only one of you works hard, you both get a B, which gives each of you 30 units of happiness.• If neither of you works hard, you both get a D, which gives each of you 10 units of happiness.• Working hard costs 25 units of happiness.a. Fill in the payoffs in the following decision box:
b. What is the likely outcome? Explain your answer.c. If you get this classmate as your partner on a series of projects throughout the year, rather than only once, how might that change the outcome you predicted in part (b)?d. Another classmate cares more about good grades: She gets 50 units of happiness for a B and 80 units of happiness for an A. If this classmate were your partner (but your preferences…
specialize in producing radios? Compasses?
Problem 2
Gary and Diane must prepare a presentation for their economics class. As part of their presentation, they
must do a series of calculations and prepare 50 PowerPoint slides. It would take Gary 10 hours to do the
required calculation and 10 hours to prepare the slides. It would take Diane 12 hours to do the
calculations and 20 hours to prepare the slides.
How much time would it take the two to complete the project if they divide the
calculations equally and the slides equally?
a.
How much time would it take the two to complete the project if they use comparative
advantage and specialize in calculating or preparing slides?
b.
If Diane and Gary have the same opportunity cost of $5 per hour, is there a better
solution than for each to specialize in calculating or preparing slides? Briefly discuss.
C.
1
Finn and Edison are living on an island with no one around to buy anything. They are stranded there unless a help reaches to them. They have some basic stuff for survival but the only issue is of food. They are out of food supplies. The only options on the island are either to catch fish or gather fruits. Finn has done fishing with his father when he was young so he can catch 5 fishes in 30 minutes. Edison on the other hand was finding it hard and can only catch 2 fishes in an hour. They both also wanted to eat fruits and often look around in search of them. Finn can gather 20 apples in an hour while Edison can gather only 10 in an hour .
Illustrate PPF for Finn and Edison assuming constant opportunity costs.
Chapter 17 Solutions
Principles of Microeconomics (MindTap Course List)
Ch. 17.1 - Prob. 1QQCh. 17.2 - Prob. 2QQCh. 17.3 - Prob. 3QQCh. 17 - Prob. 1CQQCh. 17 - Prob. 2CQQCh. 17 - Prob. 3CQQCh. 17 - Prob. 4CQQCh. 17 - Prob. 5CQQCh. 17 - Prob. 6CQQCh. 17 - Prob. 1QR
Ch. 17 - Prob. 2QRCh. 17 - Prob. 3QRCh. 17 - Prob. 4QRCh. 17 - Prob. 5QRCh. 17 - Prob. 6QRCh. 17 - Prob. 7QRCh. 17 - Prob. 1PACh. 17 - Prob. 2PACh. 17 - Prob. 3PACh. 17 - Prob. 4PACh. 17 - Prob. 5PACh. 17 - Prob. 6PACh. 17 - A case study in the chapter describes a phone...Ch. 17 - Prob. 8PACh. 17 - Prob. 9PA
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