Mail X Cent X Insti X Billir X Con X Bb Micr X (48 X Brav X Cou X Netf X Ocu X Psyl X in cl x G calc X Star X C learn-us-east-1-prod-fleet01-xythos.content.blackboardcdn.com/blackboard.learn.xythos.prod/57853691332dd/15851078?X-Blackboard-Expiration=166... Q OK Update : E Microsoft Word - Econ 201 Problem Set #1.docx 1 / 4 73% + Problem Set #1 Directions: Please answer the following questions. Show your work if the question requires a calculation. If you have to draw a graph, make sure you label all axis and curves. You may discuss these questions with your fellow classmates; however, each student must submit their own work, in their own words. Work that is copied or paraphrased will not be accepted. Academic dishonesty (including the use of Chegg.com etc.) will result in a grade of zero Chapter 1 (Week 2 on Blackboard 1. (4 points) What is economics? Broadly speaking, what is the difference between microeconomics and macroeconomics? Chapter 1 & 2 (Week 2 & 3 on Blackboard) 2. (10 points) Suppose my son Nathan would earn $40,000 if he got a job right out of high school. However, his dream is to one day open a cat cafe in our town of Northampton, MA. (This is not true... he wants to be a YouTube star). Our research suggests that the explicit (or accounting) costs of opening a cat cafe would be $30,000 a year to rent a space, $20,000 to hire a part-time employee, and $10,000 for all the other supplies (food, toys, coffee pastries, etc). Our research also indicates that the revenue from opening the cafe would be $80,000 per year. a. What are the total explicit/accounting costs of opening a cat cafe? What are the accounting profits? b. What are the total economic costs of opening a cat cafe? Why are they different than accounting costs? c. If you were to think like an economist, what would you tell my son to do? Open the cafe or get a job in the labor market? Explain in class ex.pdf Show All XMail X Cent X Insti X Billir X Con X Bb Micr X (48 X Brav X Cou X Netf X Ocu X Psyl X in cl x G calc X Star X C learn-us-east-1-prod-fleet01-xythos.content.blackboardcdn.com/blackboard.learn.xythos.prod/57853691332dd/15851078?X-Blackboard-Expiration=166... Q OK Update : E Microsoft Word - Econ 201 Problem Set #1.docx 2 / 4 - 73% + Chapter 2 (Week 3 on Blackboard) 3. (10 points) Suppose we have an agrarian economy that can utilize all its resources to produce either computer chips or wheat. Below is a table of possible combinations of both goods that can be produced if they are using their resources efficiently. a. Draw this country's PPF with Computers on the X-Axis Combo Computers Wheat (Units) (Bushels) 4,000 0 3,000 4,000 monWD 2,000 7,000 1,000 9,000 0 10,000 b. Label the parts of the graph that are "Unattainable", "Efficient" and "Inefficient". 12 c. What is the opportunity cost for this country to go from producing combination E to producing combination D? What about from B to A? d. Using your finding in part c, does this country face constant, increasing, or decreasing costs when it comes to the production of computers? Explain. e. Show what would happen to the PPF if this country was suddenly hit by a huge natural disaster that wiped out a lot of factories and destroyed many fields. Label this curve "Part e' in class ex.pdf Show All XX Cer X F Inst X Bilii X W Cor X Bb Mic X X c Oct X 1' Psy X _= inc X calt X E Sta X C' learnus-east-1-prodfleet01-xythoszcontentzblackboardcdnzcom Q m if I] K l\\ Update ', Microsoft Word - Econ 201 Problem Set #1.docx Chapter 3 Weeks 476 4. (15 points) Suppose we have the market for frozen pizzas, Below is the supply and demand schedule. Price Quantity Quantity a. Draw the market forfrozen pizza in the space Supplied Demanded provided. 515 5,000 3,000 12 4,000 4,000 9 3,000 5,000 6 2,000 5,000 3 1,000 7,000 . What is the equilibrium price and quantity? Suppose the government instituted a price ceiling of $9 per pizza. Show this situation on the graph above, . If the price was $9, how many pizzas would be sold? Is there a shortage or a surplus? By how much? . Show the area of deadweight loss caused by the price control on your graph, For each of the following situations, tell me if it would impact the demand curve or the supply curve for frozen pizzas (increase/decrease), and tell me what would happen to the equilibrium price and quantity (increase/decrease). i. The price of cheese decreases lreoession causes people's incomes to fall The price of fast food [McDonalds, TacoBell, etc) increases. iv. Selling frozen pasta meals becomes much more profitable in class ex.pdf Show All X Mail X Cent X Insti X Billir X Con X Bb Micr X (48 X Brav X Cou X Netf X Ocu X Psyl X in cl x G calc X Star X C learn-us-east-1-prod-fleet01-xythos.content.blackboardcdn.com/blackboard.learn.xythos.prod/57853691332dd/15851078?X-Blackboard-Expiration=166... Q OK Update : Microsoft Word - Econ 201 Problem Set #1.docx 4 / 4 | 73% + Chapter 5 (Week 6 on Blackboard) 5. (6 points) Suppose when we look at the monthly sales of hamburgers & fries in the Devil's Den, we see that when CCSU increased the price from $7 to $13, the quantity demanded fell from 8,000 meals to 4,000 meals a. What is the price elasticity of demand for the hamburgers and fries meal at CCSU (use the midpoint formula)? b. Is this demand for this meal price inelastic or elastic? c. Why do you think this product is price inelastic/elastic? Briefly explain. 2 Chapter 6 (Week 7 on Blackboard) 6. (5 points) Jane has $20 to spend on breakfast for the next few days. Bagels cost $5 and cups of coffee cost $4. Draw Jane's budget constraint in the space below with bagels on the X- axis. 3 4 in class ex.pdf Show All X