Using marginal analysis to find the optimal quantity of a


Using marginal analysis to find the optimal quantity of a good The following graph input tool shows the marginal benefit and marginal cost curves for footballs in an economy. At 25 million footballs, expected marginal benefits are equal to expected marginal costs. Use the graph input tool to answer the questions that follow. You will not be graded on any adjustments made to the graph input tool. 0 5 10 15 20 25 30 35 40 45 50 20 18 16 14 12 10 8 6 4 2 0 PRICE (Dollars per football) QUANTITY (Millions of footballs per year) MB MC Graph Input Tool Quantity (Millions of footballs) 25 Expected MB (Dollars per football) 10 Expected MC (Dollars per football) 10 Complete the following table by determining the relationship between the expected MB and the expected MC at each of the two quantities and what this means for society. (Hint: Be sure to use a negative sign if the net benefit is negative.) Quantity Marginal Comparison Net Benefit What Does This Mean? (Millions of balls) 35 $ 20 $

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Business Economics: Using marginal analysis to find the optimal quantity of a
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