How do you think each of the following will affect the price of diesel in the state?

a. There was a leak in the longest oil pipeline in a neighboring state.

b. New oil was discovered in the Europe.

c. The use of nuclear power was regulated and decreased.

Explain the economic problem of scare resources and unlimited wants.

Fill the blanks in the table using the formula from class. Then answer the questions below.

No. of Cars Produced per day	Variable cost	Total Cost	Marginal cost	Average Variable Cost	Average Total Cost	MR or Price	TR	Profit (TR-TC)
0	$ -	$ 3,000	$ -	$ -
3	$ 11,000	$ 14,000	$ 3,667	$ 3,667	$ 4,667	13,000	39,000	25,000
5	$ 21,000	$ 24,000	$ 5,000	$ 4,200	$ 4,800	13,000	65,000	41,000
8	$ 29,000	$ 32,000	$ 2,667	$ 3,625	$ 4,000	13,000	104,000	72,000
10	$ 39,000	$ 42,000	$ 5,000	$ 3,900	________	13,000	130,000	88,000
12	$ 50,000	$ 53,000	________	$ 4,167	$ 4,417	________	156,000	103,000
13	$ 61,000	$ 64,000	$ 11,000	$ 4,692	$ 4,923	13,000	169,000	105,000
15	$ 75,000	$ 78,000	$ 7,000	$ 5,000	$ 5,200	13,000	195,000	________

a. How many cars should the plant produce every day from the given data to minimize the marginal cost?

b. Find the point where average cost is equal or lower than marginal cost. Is this the optimal level of production? Why?