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Assignment 2 Fall 2024-2025

The document is an assignment for an introductory economics course, requiring students to solve questions related to a firm's operations in a competitive market and production possibilities in England and Spain. It includes specific tasks such as determining quantity produced, total revenue, total cost, profit levels, and comparative advantages in production. Students must submit their answers on paper by December 30th.

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5 views

Assignment 2 Fall 2024-2025

The document is an assignment for an introductory economics course, requiring students to solve questions related to a firm's operations in a competitive market and production possibilities in England and Spain. It includes specific tasks such as determining quantity produced, total revenue, total cost, profit levels, and comparative advantages in production. Students must submit their answers on paper by December 30th.

Uploaded by

mehmettemasocgps
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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ECON 101 INTRODUCTION TO ECONOMICS I

ASSIGNMENT 2
(Solve these questions by hand and submit them to your tutorial assistants on paper until 30th December)

Question 1. A firm operating in a competitive market has the following output and cost figures given in

1. Following figure belongs to a firm operating in a perfectly competitive market. Answer the
following question according to the figure below.

a. If the market price is €80, what is the quantity produced by the firm?
b. What is the Total Revenue at a price of €80?
c. What is the Total Cost of producing that quantity at (a)?
d. What is the profit level of this firm?
e. What is the break even price and quantity levels?
Question 3: Assume that England and Spain can produce both cheese and bread at a constant rate.
Following table shows the quantity of cheese and bread produced in 24 hours in each country.

Cheese Bread
England 12 8
Spain 8 4

a. Draw two Production Possibilities Frontier one for England and one for Spain (lable each axis on
each curve)

b. Show four points on the England’s PPF curve; where point A shows an EFFICIENT production
point, Point B an INEFFICIENT production point, Point C a SPECIALIZATION point and
point D an UNATTAINABLE point for England.

c. Calculate which country has comparative advantage in cheese production and in bread
production. Show your calculations.

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