Q6. Table below shows the demand for haircuts from seniors and other customers on an averageweekdayinthelocal hairdressingshop.

Priceof Haircut	QuantityDemandedbySeniors	Quantity DemandedbyOtherCustomers
$22	2	8
20	6	10
18	10	12
16	14	14
14	18	16
12	22	18
10	26	20
8	30	22
6	34	24
4	38	26

a. Between the prices of $18 and $22, which of the two demands is more elastic? Roundyouranswersto2decimal places.

b. What pricewould givethe shop thegreatestsales revenue?

Q7. a) Suppose that Daniel is willing to pay a maximum of $5 for his first slice of pizza. For eachadditional slice, he would be prepared to pay up to 50 cents less. If Daniel could obtain thepizzaforfree,howmanyslices wouldheeat?

b) If the price of a slice of pizza happened to be $2, how many slices would he purchase(assuming his budget allowed it)? What would be his total consumer surplus as a result?

Q8. Listfourdeterminantsofpriceelasticityofdemand?

Q9. Assuming that the cost of employing each worker is $220 per day (including wages andmaterials),andCustom-MadePothasweekly fixedcostsof$400,

a) Complete the following table:Round your AVC and MC answers to one decimal place.

# of Workers	TP = Output	TVC	TFC	TC	AVC	ATC	MC
1	10
2	80
3	180
4	240
5	280
6	294

b) Atwhatlevel ofemployment,thisfirmfaces diminishingreturns?

Q10. Mina recently graduated with a B.A. in economics and was offered a job with a largecompany that pays $44,000 per year. At about the same time, Mina's grandfather died andleft him an inheritance of $45,000. Mina decided to pass up the job, and using $39,000 fromthe inheritance, he purchased a tool rental business. (Mina put the other $6,000 into asavings account that pays 9 percent annual interest.) He put his full effort into the newbusiness, and in the first three months of operation he had total sales revenue of $29,500and total explicitcostsof$14,260.

a. WhatisMina'saccountingprofitfortheperiod?

b. WhatisMina'seconomic profitfortheperiod?

Q11.The table below contains short-run cost data for five different plant sizes of the R2D2RoboticsCompany.

Output	Plant1(Average Costin$)	Plant2(Average Costin$)	Plant3(Average Costin$)	Plant4(Average Costin$)	Plant5(Average Costin$)
2	1.50	2.10	/	/	/
4	1.35	1.65	/	/	/
6	1.50	1.35	1.95	/	/
8	1.80	1.20	1.50	/	/
10	2.25	1.35	1.20	1.80	/
12	/	1.65	1.05	1.20	/
14	/	2.10	1.20	1.05	1.80
16	/	/	1.50	1.14	1.35
18	/	/	1.95	1.26	1.20
20	/	/	/	1.50	1.35
22	/	/	/	1.80	1.65
24	/	/	/	/	1.95

a. Selectthe best size ofplantwhen outputis:4,8,12,18,and 24

b. Whatplant sizewouldthefirmneedinorder toachieveminimum efficientscale(MES)?

c. AtwhatoutputleveldoesthefirmachieveMES?