Skip Header daneshia.hands  My Profile    My documents   Email     Directory   Resources   Calendar   Technical Support    Sign out                                                                                 3:04 PM (CDT)     Skip Navigation            Academics       Alumni       Library       Learning Center       Accounts       Financial Aid       Career Services       Support         Department Contacts           CTU Messenger                Home                > Principles of Microeconomics            > Assignment List          > Unit 4 – Individual Project                          Principles of Microeconomics(ECON212-1802A-01)  Skip Class Navigation    Expand Menu     Course Home   Assignments                Grades   Meeting Times        Resources     Tools   Classmates   Course Information   .                                                                        View as PDF          |  Help   .  Unit 4 – Individual Project    Collapse Assignment Overview & “Go To” Links                                             Assignment Overview     Type: Individual Project   Unit:  Market Structure and Firm Strategy      Due Date:  Wed, 5/2/18      Grading Type: Numeric    Points Possible:    200       Points Earned:  0      Deliverable Length:  See description below     View objectives for this assignment     Go To:     •Assignment Details •Scenario  •Learning Materials •Reading Assignment     My Work:   Online Deliverables:   Submissions               Looking for tutoring? Go to Smarthinking           Collapse All | Expand All .   Assignment Details           Assignment Description         Assume that you have decided to start your own Internet business to sell cookbooks online (justcookbooks.com). You estimate that the annual cost of this business in the first year will be as follows:  Fixed explicit costs (annually): •Technology (Web design and maintenance)   $5,000  •Postage and handling                                   $1,000  •Miscellaneous                                              $5,000  •Equipment                                                  $4,000  •Overhead                                                    $1,000  TOTAL Explicit Fixed Costs (annual)                         $16,000  Fixed implicit costs (annually): •Lost wages from job given up (annual)           $50,000  Variable cost = $20 per book.  Part 1: Assume that the equation for demand is Q = 40,000 – 500P, where •Q = the number of cookbooks sold per year  •P = the retail price of books  Using the information above, fill in the attached chart (note that quantity is just the solution of the demand curve above; the first two lines of the table have been completed for you – you need to complete all other lines in the table):  Indicate the maximum profit price and quantity by highlighting those particular values with red font.   Part 2: After you complete the chart (either fill in the empty boxes in the table above or create an Excel file), copy and paste the table into a Word file. This table should be at the top of your assignment. Then answer the following questions (based on the chart and your understanding of this material) in 600-800 words: 1.Why, according to an economist, should implicit costs (i.e., lost wages from job given up) be included in the total cost of your product to compute economic profit?   2.Why does price elasticity of demand change as you move up the demand curve (more specifically, as the price of the product increases)?  3.Explain in your own words why MR = MC produces maximum profit for a company.    You may use the following two resources to assist in this assignment as well:  •Algebra tutorial website  •Excel tutorial website   Please submit your assignment.  For assistance with your assignment, please use your text, Web resources, and all course materials.