1. Which is more economical, a plant with a payroll of $400 a week, with $100 of overhead, and with an output of 100 units per week, or a plant with a payroll of $80,000 a week, an overhead of $100,000 a week, and an output of 50,000 units per week?
2. How do you explain economies of large-scale production? Why do certain business, such as cigarette manufacture, seem to enjoy them, whereas other business, such as barbering, do not?
3. Compare the situations of a farmer selling his wheat crop and an auto company executive selling his car "crop." What are the major forces that bear on each, when it comes to pricing the output?