***PLEASE HELP ME WITH QUESTIONS 1, 2 AND 3 FOR MY HOMEWORK. I HIGHLIGHTED THE QUESTIONS IN BOLD FOR YOUR CONVENIENCE.
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1) The Clemson Manufacturing Corporation engineers have estimated that a new factory can be constructed for the manufacture of hydraulic valves and fittings. Two different technologies, A and B. have been considered in the manufacturing process. The costs of the factory and the annual earnings are given below for both technologies. At the end of five years, technology A will have a scrap value of $1 million, and technology B will have a scrap value of $5 million. Assume that these two projects are equally risky and the appropriate interest rate is 10 percent. Calculate the net present value for each of the two options, and determine if either or both would be feasible. (you must show your work) End of Year Capital Costs (millions of Dollars $) Earnings (millions of dollars $) A B A B 10 15 0 0 10 10 -1 0 2 10 0 2 w t 0 0 5 10 0 0 10 10 5 0 0 20 102) Carolina is a student at Basketball University. She has five hours to study for two exams today. The table below shows Carolina's expected scores given the amount of time she studies for each exam. # of hours spent Expected score on # of hours spent Expected score on studying micro exam (out of studying calculus micro exam (out of microeconomics 100) 100) 5 100 0 4 96 40 INP 3 90 60 2 82 3 72 1 60 4 77 0 0 5 80 Carolina spends three hours study microeconomics and two hours studying calculus. Calculate her gain from the second hour studying calculus. 11. Calculate Carolina's opportunity cost of the second hour studying calculus. Assume Carolina increases the time she allocates to studying calculus. What happens to the opportunity cost of studying calculus? Explain. iv . Assume that Carolina has a goal of maximizing the sum of her test scores (the score on the microeconomics test plus the score on the calculus test). How many hours should she study for each exam? Carolina learns that her basketball practice has been cancelled, freeing up an additional hour for studying. Given your answer to part (iv), will Carolina allocate the additional hour to studying microeconomics or to studying calculus to maximize the sum of her test scores? Explain using marginal analysis. 3) Jacqueline's Car Wash is a profit-maximizing firm with the following production information. Number of workers Number of Cars Washed Per Day 0 0 1 15 35 60 75 85 80 i. With which worker is marginal product maximized? ii. Identify and define the economic principle that explains why marginal product eventually decreases. iii. Explain why Jacqueline would never hire the sixth worker? If Jacqueline charges $6 for washing a car, what is the maximum daily wage that Jacqueline would be willing to pay the fourth worker
