Homework Answers
Alice operates in perfectly competitive market so she is naturally a price taker. Now she would leave only when there is a transition from short run to long run provided that the price falls below the average variable cost. Note that for economic profit, price should be greater than minimum of average cost at the profit maximizing quantity because once it is ensured, the P = MC conditions results in a profit since MC > AC beyond this point.
Both 2 and 3 are true.
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QUESTION 1 Alice owns a cafe in the Brisbane CBD. Due to the large number of...
Please help me in both questions, thank you very much :) QUESTION 1 Alice owns a...
Please help me in both questions, thank you very much :)
QUESTION 1 Alice owns a cafe in the Brisbane CBD. Due to the large number of cafes in area, the market is highly competitive. 1. If Alice experiences economic losses, she would definitely leave the market immediately 2. Alice is a price taker. 3. If the market price is above the minimum ATC for the profit maximising quantity Alice produces, Alice is making an economic profit. Which of the...
Please help me in both questions, thank you very much :) QUESTION 3 Ben is a...
Please help me in both questions, thank you very much
:)
QUESTION 3 Ben is a musician who has just finished his degree in music technology. He is currently deciding whether or not to accept a job in Brisbane as a music teacher at a local school, or focus on being a touring musician. He ill earn a wage of $35,000/year as a teacher in Brisbane, and $25,000/year as a touring musician based in Melbourne. Rent is $10,000lyear in Brisbane,...
QUESTION 8 Jen is the only seller of bottled water at the Brisbane Entertainment Centre, There...
QUESTION 8 Jen is the only seller of bottled water at the Brisbane Entertainment Centre, There are no close substitutes available. Patrons are not allowed to bring any form of bottled water to the venue, Select the item from the list provided to make the following statements true: The extent of the deadweight 1. Supply loss created by Jen's monopoly depends on her ability to set 3. Economic profits price. This is also referred to as 4. Marginal revenue 2....
TRUE OR FALSE TF DO 1. In a price-taker market, all firms produce an identical product...
TRUE OR FALSE TF DO 1. In a price-taker market, all firms produce an identical product and each firm comprises only a very small portion of the total market. 2. If a price-taker firm wants to sell its output, it must accept the market price, but it can sell as much output as it wishes at that market price. O N 3. For a price-taker firm, its marginal revenue from the sale of an addi- tional unit is generally less...
Question 2 [10] TRUE/FALSE QUESTIONS Consider the following list of statements. Each statement is either true...
Question 2 [10] TRUE/FALSE QUESTIONS Consider the following list of statements. Each statement is either true or false. You must read each statement carefully and then select the option that you believe is correct as your answer. Write down only the question number and next to the number either True or False. 2.1 A change in the size of the population due to a change in birth or death rates will not shift the market supply labour curve. Normal profit...
QUESTION 5 Australians are one of the highest per capita consumers of coffee in the world....
QUESTION 5 Australians are one of the highest per capita consumers of coffee in the world. Their coffee consumption has been increasing over the years. As a result, a large number of cafes have continued to open across Brisbane to cater for this increasing demand. Answer the following questions: a. Imagine the market is currently at long run equilibrium. Research has recently been published indicating coffee consumption may lead to increased incidents of cancer. This negative publicity about coffee would...
Part 1. 1. Use the figure above to answer this question. Consider a perfectly competitive market experiencing good time...
Part 1.
1. Use the figure above to answer this question.
Consider a perfectly competitive market experiencing good times.
Figure ________ shows a firm maximizing profit in the LONG RUN
because it produces ________ units and makes an economic profit of
________.
A) A; 100; $2 per unit
B) A; 90; $3 per unit
C) B; 100; $0 per unit
D) C; 100; $3 per unit
Part 2.
2. The figure above shows a firm's demand and marginal
revenue curves...
Question 1 For a monopolist? Select one: a. all of the above are true. b. existing...
Question 1 For a monopolist? Select one: a. all of the above are true. b. existing economic profits can be sustained over time. c. its demand curve is downward sloping. d. its marginal revenue is less than price. Question 2. For a natural monopoly, which of the following is false? Select one: a. It is more efficient to have a single firm produce the good. b. One large firm can produce at lower cost than two or more smaller firms....
1. A cartel is a group of firms that attempts to a. maximize joint revenue. b....
1. A cartel is a group of firms that attempts to a. maximize joint revenue. b. increase competition. c. behave independently. d. maximize joint profit. 2. If a firm's product loses brand loyalty, then the demand curve will: a. Become less price elastic. b. Shift to the right. c. Become more price elastic. d. Shift to the left. 3. Assume a monopoly confronts the same costs and demand as a competitive industry. In this case, the monopolist produces: a. Less...
1. Consider a competitive industry with a large number of firms, all of which have identical...
1. Consider a competitive industry with a large number of firms, all of which have identical cost functions c(y) = y^2 + 1. Suppose that initially the demand curve for this industry is given by D(p) = 52 - p: (The output of a firm does not have to be an integer number, but the number of firms does have to be an integer.) Answer part (c) through (e), and please show work? (c) What will be the equilibrium price?...
Please help me in both questions, thank you very much :)
QUESTION 1 Alice owns a cafe in the Brisbane CBD. Due to the large number of cafes in area, the market is highly competitive. 1. If Alice experiences economic losses, she would definitely leave the market immediately 2. Alice is a price taker. 3. If the market price is above the minimum ATC for the profit maximising quantity Alice produces, Alice is making an economic profit. Which of the...
Please help me in both questions, thank you very much
:)
QUESTION 3 Ben is a musician who has just finished his degree in music technology. He is currently deciding whether or not to accept a job in Brisbane as a music teacher at a local school, or focus on being a touring musician. He ill earn a wage of $35,000/year as a teacher in Brisbane, and $25,000/year as a touring musician based in Melbourne. Rent is $10,000lyear in Brisbane,...
QUESTION 8 Jen is the only seller of bottled water at the Brisbane Entertainment Centre, There are no close substitutes available. Patrons are not allowed to bring any form of bottled water to the venue, Select the item from the list provided to make the following statements true: The extent of the deadweight 1. Supply loss created by Jen's monopoly depends on her ability to set 3. Economic profits price. This is also referred to as 4. Marginal revenue 2....
TRUE OR FALSE TF DO 1. In a price-taker market, all firms produce an identical product and each firm comprises only a very small portion of the total market. 2. If a price-taker firm wants to sell its output, it must accept the market price, but it can sell as much output as it wishes at that market price. O N 3. For a price-taker firm, its marginal revenue from the sale of an addi- tional unit is generally less...
Question 2 [10] TRUE/FALSE QUESTIONS Consider the following list of statements. Each statement is either true or false. You must read each statement carefully and then select the option that you believe is correct as your answer. Write down only the question number and next to the number either True or False. 2.1 A change in the size of the population due to a change in birth or death rates will not shift the market supply labour curve. Normal profit...
QUESTION 5 Australians are one of the highest per capita consumers of coffee in the world. Their coffee consumption has been increasing over the years. As a result, a large number of cafes have continued to open across Brisbane to cater for this increasing demand. Answer the following questions: a. Imagine the market is currently at long run equilibrium. Research has recently been published indicating coffee consumption may lead to increased incidents of cancer. This negative publicity about coffee would...
Part 1.
1. Use the figure above to answer this question.
Consider a perfectly competitive market experiencing good times.
Figure ________ shows a firm maximizing profit in the LONG RUN
because it produces ________ units and makes an economic profit of
________.
A) A; 100; $2 per unit
B) A; 90; $3 per unit
C) B; 100; $0 per unit
D) C; 100; $3 per unit
Part 2.
2. The figure above shows a firm's demand and marginal
revenue curves...
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