As in problem 1-18, state the correct economic criterion for each of the following situations.
a. The engineering student club raffled off a donated car, tickets sold for $5 each or three for $10. When the students were selling tickets, they noted that many people had trouble deciding whether to buy one or three tickets. This indicates that the buyer’s criterion was Maximize the benefits
b. Profit maximization
c. Minimizing costs
d. Maximizing benefits
2-2: One of your firm’s suppliers discounts prices for larger quantities. The first 1000 parts are $13 each. The next 2000 are $12 each. All parts in excess of 3000 cost $11 each. What are the average cost and marginal cost per part for the following quantities? A. 500, B.1500, C.2500, D.3500.
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