It costs a company $30,000 to begin production of a good, plus $3 for every unit of the good produced. Let be the number of units produced by the company. (a) Find a formula for (), the total cost for the production of units of the good. (b) Find a formula for the companys average cost per unit, (). (c) Graph = () for 0 < 50,000, 0 10. Label the horizontal asymptote. (d) Explain in economic terms why the graph of has the long-run behavior that it does. (e) Explain in economic terms why the graph of has the vertical asymptote that it does. (f) Find a formula for 1(). Give an economic interpretation of 1(). (g) The company makes a profit if the average cost of its good is less than $5 per unit. Find the minimum number of units the company can produce and make a profit.
Social Psychology: Chapter 12 How we behave around other people How we think about/relate to influence one another o Someone present or watching (could be physical or implied presence) Social Influence o Several different forms o Hitler, Stalin, David Koresh One person’s impact can have an impact on people o Social norms Face forward in elevator Wait in lines Certain places where you should smoke o Persuasion Attitudes or beliefs influenced by another person’s communication Systematic Appeal to reason Reasons why best presidential candidate / lay out facts Heuristic Appeal to emotion o Conformity Tendency to what others do just because they are doing it Why we conform Normative influence (social norms) o Want to fit it, want others approval Informative influence o Not sure how to act; look to others to see what to do Asch’s study of Conformity o Conformity surprisingly high given: Unambiguous Strangers Low stakes for being wrong o 24% participants never conformed Personality characteristics/ factors Desire for consistency o Changed either attitudes/beliefs or behavior o Foot in the Door Technique Agree to small action; comply later with larger one Safe driver study 17% consented to large, poorly lettered “Drive Carefully” sign Almost 100% consented to 3-inch “Be a safe driver” sign 76% consented to the large sign Cognitive Dissonance o Behaviors influence attitudes/beliefs o Cognitive Dissonance Theory Festinger Inconsistency leads to discomfort, change in attitude Menial Task o Group 1 and 2 Tell others it’s fun o Group 1 gets $1 and group 2 gets $20 Which says it’s more enjoyable o Group 1 If unable to justify attitude change how they feel about the task o Obedience Form of compliance People follow direct commands, usually authority figure Milgram Experiment Test how people are really that evil (WWII and Holocaust time period) Completely unethical so can’t be used today 26/40 (65%) completed the experiment Factors that affect obedience o Yale vs. office building (48%) o Multiple “teachers” Accomplices accepted orders (65%) Accomplices defied orders (10%) Group Behavior: 2 extremes Diffusion of Responsibility o If alone, responsibility is yours, if others present, divided o Smoke filled room Informational influence o Helping Behavior People are less likely to help when in a group than when alone 75% help if alone 53% help in a group Deindividuation o Large groups may increase impulsive, uninhibited behaviors o Less aware of individual values (take on values of the group) Ex: Riots o Altruism Behavior that helps other person Unique to humans Reciprocal altruism Expect something in return (seen in animals) o Cooperation Behavior that leads to mutual benefit Studied quite a bit Prisoner’s dilemma (game) At first both remain silent, eventually one will confess (b/c people are thinking only of themselves Tit-for-tat (iterative game) Also one with forgiveness Watch out for cheaters Ultimatum game 2 people offer and accept