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10. A firm pays Pam $40 per hour to assemble personal computers. Each day, Pam can assemble 4 computers if she works 1 hour, 7 computers if she works 2 hours, 9 computers if she works 3 hours, and 10 computers if she works 4 hours. Pam cannot work more than 4 hours a day. Each computer consists of a motherboard, a hard drive, a case, a monitor, a keyboard, and a mouse. The total cost of these parts is $600 per computer. If the firm sells each computer for $625, then how many hours a day should the firm employ Pam to maximize the firm's net benefit from her employment? (10%)

9. Larry has to select one graduate school out of the three that he got accepted to. Larry was not offered for any financial aid from Elite U, which charges $50,000 annually. Larry places a $60,000 annual value on attending Elite U. Larry was awarded an annual $10,000 scholarship by State College, which charges $30,000 per year. Larry considers State College to be worth $40,000 a year. NoName U costs $20,000 per year, and offered Larry a full $20,000 annual scholarship. Larry values attending NoName at $15,000 per year. What is Larry's opportunity cost of attending State College? (10%)

8. Suppose there are three power-generating plants, each of which has access to 5 different production processes. The table below summarizes the cost of each production process and the corresponding number of tons of smoke emitted each. Suppose the government decides to impose a tax on each ton of smoke emitted. What would be the lowest tax, in whole dollars, that would reduce emissions to 6 tons per day? (10%) | Process(smoke/day) | A (4 tons/day) | B (3 tons/day) | C (2 tons/day) | D (1 ton/day) | E (0 ton/day) | | --- | --- | --- | --- | --- | --- | | Cost to Firm X ($/day) | $500 | $514 | $530 | $555 | $585 | | Cost to Firm Y ($/day) | $400 | $420 | $445 | $480 | $520 | | Cost to Firm Z ($/day) | $300 | $325 | $360 | $400 | $550 |

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