Question

Question 20 1 pts When people spend more years in school, this results in a externality because there are created by a more highly educated population. positive; external costs negative; internal costs O positive; internal benefits positive; external benefits negative; external costs

Answer 1

20. Ans: Positive ; external benefits

Explanation:

Because more educated people tend to bring more economic value to their society.

15. Ans: decrease by 60%

Explanation:

PED = % change in quantity demanded / % change in price

% change in price = % change in quantity demanded / PED

                              = 30% / -0.5

                              = -60%

It means price should decrease by 60%

24.Ans: $700

Explanation:

TC of producing 1 unit of good = FC + VC = $500 + $200 = $700

ATC of producing 1 unit of good = TC / Q = $700 / 1 = $700

25. Ans: 4

Explanation:

Q	FC($)	VC($)	TC($)=FC+VC	AFC($)=FC/Q	AVC($)=VC/Q	ATC($)=TC/Q	MC($)=∆TC/∆Q
1	500	200	700	500.00	200.00	700.00
2	500	300	800	250.00	150.00	400.00	100.00
3	500	375	875	166.67	125.00	291.67	75.00
4	500	425	925	125.00	106.25	231.25	50.00
5	500	500	1000	100.00	100.00	200.00	75.00
6	500	625	1125	83.33	104.17	187.50	125.00