1. Kalina's Krepes has the following total product schedule: Labor Output (workers (crepes per week] per day) 0 30 70 120 4 160 190 210 220 a. Calculate the average product of labor and the marginal product of labor. b. Over what output range does Kalina's Krepes experience the benefits of more specialization (increased returns to labor)? Diminishing marginal returns? What does this tell us about MC over these ranges? Assume Kalina's Krepes can hire workers at $500 a week and the rent is $1000 a week. Assume there are no other costs of production. C. Calculate the average total cost, average variable cost, average fixed cost, and marginal cost of each output in the table. d. Draw the market for crepes, next to a the graph of Kalina's Krepes's cost curves. If the price per crepe in the market is $15 (these are fancy crepes!), will Kalina produce crepes or shut down in the short run? Label Kalina's profits on the graph. Is she making positive profits, negative profits, or breaking even? Show and explain what will happen in this market in the long-run. 190 180 146 TP-qe. What is one demand shifter that could increase the price of crepes? Draw the market for crepes, next to a rough sketch of Kalina's Krepes's cost curves. If the price per crepe in the market rises to $25 (these are fancy crepes!), will Kalina produce crepes or shut down in the short run? Label Kalina's profits on the graph. Is she making positive profits, negative profits, or breaking even? Show and explain what will happen in this market in the long-run. 35 30 230 TP q f. What happens to the cost curves if the rent on Kalina's factory goes up by $200/wk? Could this affect Kalina's decisions in the SR? The LR? g. What happens to the cost curves if the workers negotiate a wage increase of $100/wk? Could this affect Kalina's decisions in the SR? The LR