Table shows the demand schedule for Lin’s Fortune Cookies. Table shows some cost data for Lin’s. Use this information to work Problems (Hint: Make a sketch of Lin’s short-run cost curves.)
Price (dollars per batch) |
Quantity demanded (batches per day) |
50 |
0 |
50 |
1 |
50 |
2 |
50 |
3 |
50 |
4 |
50 |
5 |
50 |
6 |
Quantity (batches per day) |
AFC |
AVC |
ATC |
MC |
|
(dollars per batch) |
|||
1 |
84.0 |
51.0 |
135 |
|
|
|
|
|
37 |
2 |
42.0 |
44.0 |
86 |
|
|
|
|
|
29 |
3 |
28.0 |
39.0 |
67 |
|
|
|
|
|
27 |
4 |
21.0 |
36.0 |
57 |
|
|
|
|
|
32 |
5 |
16.8 |
35.2 |
52 |
|
|
|
|
|
40 |
6 |
14.0 |
36.0 |
50 |
|
|
|
|
|
57 |
7 |
12.0 |
39.0 |
51 |
|
|
|
|
|
83 |
8 |
10.5 |
44.5 |
55 |
|
At a market price of $50 a batch, what quantity does Lin’s produce and what is the firm’s economic profit in the short run?
Test—CI connection In exercise 1, explain how the result of the 99% confidence interval in part b corresponds to the result of the decision using significance level 0.01 in part c.
Exercise 1
Time spent on Internet In 2006, the General Social Survey asked about the number of hours a week spent on the World Wide Web (variable denoted WWWTIME). Some results are as follows:
Group | N | Mean | StDev | SE Mean |
Male | 1196 | 6.2 | 9.9 | 0.285 |
Female | 1569 | 4.9 | 8.6 | 0.216 |
Difference = mu(Male) − mu(Female) | ||||
Estimate for difference: 1.3 | ||||
99% CI for difference: (0.4. 2.2) | ||||
T-Test of difference = 0 (vs not =): | ||||
T-value = 3.62 P-value = 0.000 |
a. Identify the response variable and explanatory variable. Indicate whether each variable is quantitative or categorical.
b. Report and interpret the 99% confidence interval shown for the difference between the population means for males and females.
c. Report and interpret the steps of the significance test comparing the two population means. Make a decision, using significance level 0.01.
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