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Table 144 -Refer to Table 14

Question 146

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Table 14.4
 Number  of  Machines  Output  of  Pencils  (boxes  per  week) Marginal  Product of  Capital  Product  Price  (dollars  per box)  Total  Revenue  Marginal  Revenue  Product of  Capital  Rental  Cost per  Machine Additional  Profit from  Renting  One  Additional  Machine LQMPPTR MRP R00$40$240110402402184024032540240431402405364024064040240\begin{array}{|c|c|c|c|c|c|c|c|}\hline \begin{array}{l} \text { Number }\\ \text { of }\\ \text { Machines }\\\end{array}& \begin{array}{l} \text { Output }\\ \text { of }\\ \text { Pencils }\\ \text { (boxes }\\ \text { per }\\ \text { week)}\\\end{array} & \begin{array}{l} \text { Marginal }\\ \text { Product of }\\ \text { Capital }\\\end{array} & \begin{array}{l} \text { Product }\\ \text { Price }\\ \text { (dollars }\\ \text { per box) }\\\end{array} & \begin{array}{l} \text { Total }\\ \text { Revenue }\\\end{array} & \begin{array}{l} \text { Marginal }\\ \text { Revenue }\\ \text { Product of }\\ \text { Capital }\\\end{array} & \begin{array}{l} \text { Rental }\\ \text { Cost per }\\ \text { Machine }\\\end{array} & \begin{array}{l} \text {Additional }\\ \text { Profit from }\\ \text { Renting }\\ \text { One }\\ \text { Additional }\\ \text { Machine }\\\end{array} \\\hline L & Q & M P & P & T R & \text { MRP } & R \\\hline 0 & 0 & - & \$ 40 & & - & \$ 240 \\\hline 1 & 10 & & 40 & & & 240 \\\hline 2 & 18 & & 40 & & & 240 \\\hline 3 & 25 & & 40 & & & 240 \\\hline 4 & 31 & & 40 & & & 240 \\\hline 5 & 36 & & 40 & & & 240 \\\hline 6 & 40 & & 40 & & & 240 \\\hline\end{array}
-Refer to Table 14.4.Dante owns a pencil factory and faces the situation shown in the table and the cost of renting a machine is $240 per week.
a.Fill in the blanks in the table and determine the profit-maximizing number of machines for Dante to rent.Explain why renting this number of machines is profit maximizing.
b.Draw Dante's demand curve for capital.

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a.Dante should rent 4 machines...

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