A representative firm in a perfectly competitive, constant cost industry has a cost function T C...
A representative firm in a perfectly competitive, constant cost industry has a cost function T C = 100+4Q 2+ 100Q.
(a) What are this firm fixed cost, variable cost and marginal cost?
(b) What is the long-run equilibrium price for this industry?
(c) If the market demand is Q = 1000 − P , how many firms will operate in this long-run equilibrium?
(d) What is the most that this firm would be willing to pay for the exclusive right to use this new technology?
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A representative firm in a perfectly competitive, constant cost
industry has a cost function T C...
The first picture below depicts the cost curves for a representative firm in this perfectly competitive industry. Initia...
The first picture below depicts the cost curves for a
representative firm in this perfectly competitive industry.
Initially, there are 100 firms. The second picture depicts market
demand.
A) Suppose that the firm produces 300 units of output, how much
are their total costs?
B) What is the short-run equilibrium price?
C) At the short-run equilibrium price, what is the quantity
produced by each firm?
D) At the short-run equilibrium price, what is per-firm
profit?
E) In the long-run,...
Each firm in a perfectly competitive market has long run average cost represented as AC(q) =...
Each firm in a perfectly competitive market has long run average cost represented as AC(q) = 100q- 10+100/q. Long run marginal cost is MC=200q-10. The market demand is Qd = 2150-5P. Find the long run equilibrium output per firm, q*, the long run equilibrium price, P*, and the number of firms in the industry, n*. P = 190; Q = 1200; q =1 , n = 1200
Suppose that a particular firm is in a perfectly competitive constant-cost industry. When it is using...
Suppose that a particular firm is in a perfectly competitive constant-cost industry. When it is using the optimal amount of capital for the long-run, total cost is C(q)=1000+(q2/10), ATC(q)=(1000/q)+q/10, and marginal cost is MC(q)=2q/10. This implies that ATC=MC at a quantity of 100 and a per unit cost of $20. 1. At what quantity is average total cost minimized? 2. What is the long-run competitive equilibrium price? 3. If market demand is QD=12,000-200P and short-run market supply is QS=300P, what...
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)...
1. Suppose firms in a perfectly competitive, constant cost (i.e., flat LR supply curve), industry face...
1. Suppose firms in a perfectly competitive, constant cost (i.e., flat LR supply curve), industry face monthly demand given by Qp = 1000 - P and have access to a production technology that yields a cost function TC(Q:) = 40? + 100Qi + 100 where Q denotes units produced per month. Assume the only difference between short-run and long-run costs is T C(0) = 100 in the short run and TC(O) = 0 in the long run (which is consistent...
Consider a perfectly competitive industry in which each firm i has a total cost function given...
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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
1. (18pts) Suppose there are 100 firms in a perfectly competitive industry. Short run marginal costs...
1. (18pts) Suppose there are 100 firms in a perfectly competitive industry. Short run marginal costs for each firm are given by SMC = q + 2 and market demand is given by Qd = 1000-20P (5pts) Calculate the short run equilibrium price and quantity for each firm.. b. (3pts) Suppose each firm has a U-shaped, long-run average cost curve that reaches a minimum of $10. Calculate the long run equilibrium price and the total industry output.. (4pts) What is...
Numerical Example A representative firm is operating in a perfectly competitive industry. The firm’s total cost,...
Numerical Example A representative firm is operating in a perfectly competitive industry. The firm’s total cost, TC, is given by the equation TC = 50 + 5q2 , where q is output. Based on this equation, the marginal cost, MC, is 10q. 1. If the output price is $100, what is the short-run profit-maximizing output? 2. How much profit does this firm make at that level of output? 3. What do you expect to happen in the market in the...
37. If every firm in a perfectly competitive industry experiences the same technological improvement, then A....
37. If every firm in a perfectly competitive industry experiences the same technological improvement, then A. the firm's short-run supply curves will shift to the right. B. the industry's short-run supply curve will shift to the right. C. the industry's long-run supply curve will shift downward or to the right D. All of the above statements are true. E. Only A and B are true. D, a, ap, o, 38. In a perfectly competitive, constant-cost industry, the long-run equilibrium price...
The first picture below depicts the cost curves for a
representative firm in this perfectly competitive industry.
Initially, there are 100 firms. The second picture depicts market
demand.
A) Suppose that the firm produces 300 units of output, how much
are their total costs?
B) What is the short-run equilibrium price?
C) At the short-run equilibrium price, what is the quantity
produced by each firm?
D) At the short-run equilibrium price, what is per-firm
profit?
E) In the long-run,...
1. Suppose firms in a perfectly competitive, constant cost (i.e., flat LR supply curve), industry face monthly demand given by Qp = 1000 - P and have access to a production technology that yields a cost function TC(Q:) = 40? + 100Qi + 100 where Q denotes units produced per month. Assume the only difference between short-run and long-run costs is T C(0) = 100 in the short run and TC(O) = 0 in the long run (which is consistent...
1. (18pts) Suppose there are 100 firms in a perfectly competitive industry. Short run marginal costs for each firm are given by SMC = q + 2 and market demand is given by Qd = 1000-20P (5pts) Calculate the short run equilibrium price and quantity for each firm.. b. (3pts) Suppose each firm has a U-shaped, long-run average cost curve that reaches a minimum of $10. Calculate the long run equilibrium price and the total industry output.. (4pts) What is...
37. If every firm in a perfectly competitive industry experiences the same technological improvement, then A. the firm's short-run supply curves will shift to the right. B. the industry's short-run supply curve will shift to the right. C. the industry's long-run supply curve will shift downward or to the right D. All of the above statements are true. E. Only A and B are true. D, a, ap, o, 38. In a perfectly competitive, constant-cost industry, the long-run equilibrium price...
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