Question

 Estimate a Total Benefit and Total Cost formula for your product. In Excel, produce a chart that shows both functions with 50 data points (i.e. A=1…50). You decide what is A in your case (i.e. number of workers, hours of labor, etc. This is important because is going to determine your costs and profit).

Answer 1

Let Q be the number of units produced by the firm and each unit is sold for $ 5. The total cost of producing the units involve paying labor wages . Let the cost of each labor unit be $ 2 and each labor can produce only one unit per day. Thus to produce more units per day, we require more labor.

Total benefit = $ 5 xQ

Total cost = $ 2Q

Q	Total benefit	Total cost
0	0	0
1	5	2
2	10	4
3	15	6
4	20	8
5	25	10
6	30	12
7	35	14
8	40	16
9	45	18
10	50	20
11	55	22
12	60	24
13	65	26
14	70	28
15	75	30
16	80	32
17	85	34
18	90	36
19	95	38
20	100	40
21	105	42
22	110	44
23	115	46
24	120	48
25	125	50
26	130	52
27	135	54
28	140	56
29	145	58
30	150	60
31	155	62
32	160	64
33	165	66
34	170	68
35	175	70
36	180	72
37	185	74
38	190	76
39	195	78
40	200	80
41	205	82
42	210	84
43	215	86
44	220	88
45	225	90
46	230	92
47	235	94
48	240	96
49	245	98
50	250	100