Problem Set 1

I. Fill in the values for the Average Product and the Marginal Product
Fixed Input
1
1
1
1
1
1
1
1
1
1
1

Variable Input
0
1
2
3
4
5
6
7
8
9
10

II. Fill in the missing values

Output
Total Cost
Total
Variable
Cost
0
50
2
4
71
6
8
90
10
50.5
12
111.5
61.5
14
124.5
74.5
16
140.5
90.5
18
162.5
112.5
20
202.5
152.5

Total Product
0
100
270
420
560
680
770
820
820
760
650

Total
Fixed Cost

Average Product

Marginal
Cost

Average
Cost

7.00
3.50
4.50

17.75

5.50
6.50
20.00

11.25
10.05
8.89
8.78
9.03

Marginal Product

Average
Variable
Cost

Average
Fixed Cost

5.00

8.33
5.00

5.13
5.32
5.66
6.25
7.63

2.50

III. Illustration:
1. Find the slope of the supply equation then illustrate its graph.
Supply Equation: Qs = P

2. Suppose the supply equation in #1 is the supply equation for umbrellas. What will happen to the supply
curve if the minimum wage will increase by 20%?