Suppose a firm in a perfectly competitive market has the cost function c(y)=y2 + 2y +4...

Question

Question

Suppose a firm in a perfectly competitive market has the cost function c(y)=y2 + 2y +4 Now suppose that there is a sudden inc

business economics

Answer 1

Answer #1

Answer

Long-run price is the minimum average total cost and the quantity is the production at the minimum ATC.

It is found by the first differentiation of the ATC and set equal to 0

+ ATC дАТc ду 4 = y? у = 2 - 1-2 = 0

long-run quantity for each firm is 2 units

Answer 2

Similar Homework Help Questions

Suppose a firm in a perfectly competitive market has the cost function c(y)= y2 + 2y...

Suppose a firm in a perfectly competitive market has the cost function c(y)= y2 + 2y +4 Now suppose that there is a sudden increase in demand that raises the market price to p= 8. How much does the firm produce at this price?
D1. Suppose a firm in a perfectly competitive market has the cost function c(y)= y2 +...

D1. Suppose a firm in a perfectly competitive market has the cost function c(y)= y2 + 2y +9 What is the firm's average total cost? y + 2 y + 2 + 2y + 2
Question 3 1 pts Suppose a firm in a perfectly competitive market has the cost function...

Question 3 1 pts Suppose a firm in a perfectly competitive market has the cost function c(y)= y2 + 2y + 9 What is the firm's fixed cost? y+2+ 2y + 2 Oy+2 Question 4 1 pts Suppose a firm in a perfectly competitive market has the cost function c(y)= y2 + 2y + 9 What is the firm's marginal cost? 2y + 2 Oy+2+2 Oy+ 09 2y

Suppose a firm with cost structure c(y)= y2 + 2y +4 is the only producer of...

Suppose a firm with cost structure c(y)= y2 + 2y +4 is the only producer of the good in the market. Market demand is given as y(p)= 40 - 2p What is the profit-maximizing quantity for this firm? Suppose a firm with cost structure c(y)= y + 2y + 4 is the only producer of the good in the market. Market demand is given as y(p)= 40 - 2p What price will the firm charge? Suppose a firm with cost...
1. Each firm in a perfectly competitive industry has the long-run total cost function c(y) =...

1. Each firm in a perfectly competitive industry has the long-run total cost function c(y) = 3y - (y^2/3) + (y^3/27) Demand is given by the inverse demand curve p = 15 - (Qd/600). Calculate, for the long-run equilibrium, a. The price b.The market quantity c. The number of firms d. The profit for each firm
Consider a perfectly competitive market with many identical firms. Each firm has a long-run marginal cost...

Consider a perfectly competitive market with many identical firms. Each firm has a long-run marginal cost function given by LRMC(y) = y ^2 + 1. We do not know the firms’ LRAT C function, but we know that at a quantity of 3 it is equal to LRMC. In other words: LRAT C(3) = LRMC(3). (a) Find an expression for an individual firm’s long-run inverse supply curve: this will be p as a function of y. Note that it will...

i) The long run cost function for each firm in a perfectly competitive market is c(q)...

i) The long run cost function for each firm in a perfectly competitive market is c(q) = 2^1.5+16q^0.5, LMC = 1.59^0.5+ 8q^-0.5, market demand curve is Q=1600-2p. Find price (p) of output and the level of output (q) produced by the firm in a long run equilibrium. Find the long run average cost curve for the firm. ii) what happens in the long run if the market demand curve shifts to Q=160-20p?/ -A competitive industry is in long run equilibrium....
Long Run Equilibrium 4. Suppose each firm in a perfectly competitive industry has the same long...

Long Run Equilibrium 4. Suppose each firm in a perfectly competitive industry has the same long run total cost function T C(q) = 16+q^2 . The market demand curve is QD = 100−P. (a) What 3 equations define a Long Run Perfectly Competitive Equilibrium? (b) How much quantity q ∗ does each firm produce in Long Run Perfectly Competitive Equilibrium? (c) What is the market price P ∗ in this equilibrium? (d) Find the market quantity Q∗ . ( e)...
22. Suppose that each firm has the long run cost function c(y) = y2 + 9...

22. Suppose that each firm has the long run cost function c(y) = y2 + 9 for y > 0 and c(0) = 0. The industry demand is given by D(p) = 51 - p. The equilibrium price in the long-run equilibrium of the industry in a perfectly competitive market is: a. $8 b. $3 c. $5 d. $4 e. $6

Suppose in a competitive market, the long-run cost function of a firm is ?(?) = 0.66874?5⁄4...

Suppose in a competitive market, the long-run cost function of a firm is ?(?) = 0.66874?5⁄4 + 1,280 where x is the output. (a) What is the minimum long-run average cost? At what output level is this attained? (b) Suppose all firms are identical, what is the long-run profit of each firm in the competitive market? What is the long-run equilibrium price? (c) Suppose there are 64,000 consumers each with demand function xd(p) = 625/p2 How many firms exist in...