This updated version plots marginal benefits and costs at the midpoints of the intervals of the quantity changes for which they are calculated.

Updated further on Mon., March 27 after withdrawal of the Republican proposal, with more recent reports and analysis.

Previously updated after class on Fri., March 10, with optional links (at the top of the second list of links) to more recent articles and to a summary of Kenneth Arrow's seminal 1963 analysis of the economics of health care.

This has been updated to correct the choice of which cells in the table to highlight for calculation of short-run TP, APL and MPL. In the original version, a row was highlighted with L=10. The corrected version highlights the cells with K=10, consistent with the wording of the question.

This older version of the example was distributed in print, and reviewed first. A newer version with a linear MC function is posted as well, and should also be examined as a model, since it is closer to the exercise for students to work through.

This version of the example was intended to be distributed in print, and was shown initially in class before noticing that the version distributed was the older one instead. It is closer to the exercise for students to work through, with algebraic solution possible, so should also be used as a model.

This spreadsheet lists the order of presentations at the beginning of the final exam session.

The part shaded pink is correct, but was copied incorrectly (on Wed. 2/8) as its reciprocal to the first part shaded green. That error was repeated in the later parts shaded green. A corrected derivation will be shown in the next class (Thurs. 2/9). The final result of the correction will be only that b, rather than 1-b, will appear in the demand function for restaurant meals (R).

We got through only part of this presentation.