1. Robin is trying to decide whether to spend her time as a news anchor which pays $100/hour or as a freelance journalist where she is paid by the news snippet she writes up, so her pay would be dependent both on the number of news snippets she writes and on her rate of pay per news snippet. Robin, is indifferent between the two tasks and care only about her earnings. The table below shows the number of news snippets she can write by devoting different amounts of time to writing.

1 hr = 6 snippets; 2 hrs = 11 snippets; 3 hrs = 15 snippets; 4 hrs = 18 snippets; 5 hrs = 20 snippets

Microsoft Word - ProblemSet2.docx

1. a.Makeatablewithpricein$5incrementsfrom$0to$50inthefirstcolumnandthequantityofnewssnippetsRobiniswillingtosupplyperdayatthatpriceinthesecondcolumn.
2. b.Plotthesepointsonagraphwithpriceontheverticalaxisandquantityofnewssnippetsperdayonthehorizontalaxis.Whatcurvedidyoujustdraw?

c.Assume Robin has no other costs, if the market price of a news snippet is $30, what is her economic profit?

d.Would this curve change if instead she could receive $200/hour as a news anchor?