COST OF PRODUCTION EXERCISE -The purpose of this exercise is to give you practice with the calculations

COST OF PRODUCTION EXERCISE
MICRO ECONOMICS

Qlabor Bu Wheat AP MP TFC TVC TC AFC AVC ATC MC
0 0 ___ ___ ___ ___ ___ ___ ___ ___ ___
1 25 ___ ___ ___ ___ ___ ___ ___ ___ ___
2 75 ___ ___ ___ ___ ___ ___ ___ ___ ___
3 155 ___ ___ ___ ___ ___ ___ ___ ___ ___
4 255 ___ ___ ___ ___ ___ ___ ___ ___ ___
5 395 ___ ___ ___ ___ ___ ___ ___ ___ ___
6 515 ___ ___ ___ ___ ___ ___ ___ ___ ___
7 605 ___ ___ ___ ___ ___ ___ ___ ___ ___
8 675 ___ ___ ___ ___ ___ ___ ___ ___ ___
9 715 ___ ___ ___ ___ ___ ___ ___ ___ ___
10 725 ___ ___ ___ ___ ___ ___ ___ ___ ___
Assume: Land rents for $500 per acre and
the workers receive $100 per worker. You
use 3 acres of land to produce the wheat.
You will be calculating the production
based on the quantities of input factor and the costs of production based on
the quantities of output.
Fill in the blanks
Use the graphing tool on excel or the draw
tool and plot the TP, AP and MP
On a separate graph, plot the AVC and MC
What do you notice about the AP and MP
graph compared to the AVC and MC graph?
Diminishing returns sets in with what units
of input?COST OF PRODUCTION EXERCISE #2The purpose of this exercise is to give you practice with the calculations and analysis introduced in this chapter. This exercise combines the information you have learned in both parts of the chapterStep 1: Create a table using excel (or word) and calculate the missing valuesStep 2: Using the graphing tool in excel (or your drawing tool) create the 2 graphs as per the instructions.Step 3: Insert the table and the 2 graphs into a word document and answer the 2 questions.

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