1.2. Suppose that Babettes total cost of a serving according to portion size is now given by...

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1.2. Suppose that Babette’s total cost of a serving according to portion size is now given by the data in the accompanying table. Assume that Babette’s total benefit and marginal benefit remain as reported in Table 9–5.

Use this information to calculate: (i) Babette’s new marginal cost; (ii) her new net gain; (iii) her new optimal serving size. What kind of marginal cost does Babette now have—constant, increasing, or decreasing?

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Economics

ISBN: 978-0716771586

2nd Edition

Authors: Paul Krugman ,Robin Wells

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