Econ Problem Set 5

[Daniel Zarovy]

Hey Guys,

Here's our results for Problem Set 5 so far.  We still have some questions regarding #4 and how to account for that $1 million....

Later,
Z

[Daniel Zarovy]

Hey Guys,

Let's all try to take a crack at problem #4 tonight.  If we can't come up w/ an answer, then we should probably try meeting as a team after class tomorrow.

Also, I don't see any group assignments due next week so I think we can cancel our team meetings...

Let me know what you think.

Thanks,
Daniel

[Dustin Goot]

OK, just spent wayyyyy too much time trying to figure this out. I'm of
the opinion that the fixed costs don't affect the supply curve,
whether they're sunk or not. Which means the curve would just follow
the marginal cost curve as long as it falls above average cost (which
is at every point in this example).

Supply curve: P = MC = 5 + Q/5000

--Dustin

On Thu, Nov 4, 2010 at 3:41 PM, Daniel Zarovy

[Daniel Zarovy]

I agree w/ Dustin as well that the Supply Curve ignores fixed costs.  Based on that, I took a stab at writing the answer for #4.  Let me know what you think.  I'd like to finalize and submit it by 9pm tonight.

Thanks,
Daniel

On Fri, Nov 5, 2010 at 9:01 AM, Yan, Claire <claire....@anderson.ucla.edu> wrote:

I agree with Dustin!!! Sorry guys, I won't be going to school today. Worked on my resume to meet IFA deadline till 3:30 am this morning!! I am seriously considering going fir product management or marketing now!! Haha, be aware of the competition guys!!!

CY

Love you guys

Sent from iPhone 4G.

[Dustin Goot]

Looks great to me.

On Fri, Nov 5, 2010 at 1:30 PM, Daniel Zarovy

[Sixiao Guo]

Should the last line read:

Therefore, the Supply Curve :  P = 5 + Q/5000   

not sure if we need to add the P=  ?

[Daniel Zarovy]

Good call.  The question says "i.e. the quantity supplied as a function of market price?" so I've updated it to include P=