Question 5 If the price of the output of a profit-maximising, competitive firm rises and all...
Homework Answers
True.
- When the price of output of a profit maximizing competitive firm rises and all other prices stay constant, then the firm's output cannot fall.
- This is because a profit maximizing firm will always try to produce a profit maximizing level of output and choose a profit maximizing price at which it can sell it's output.
- As long as the price rises, the firm will increase it's supply of it's output.
- Hence, the firm's output production will not fall as long as the price required to cover other costs rises.
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Question 5 If the price of the output of a profit-maximising,
competitive firm rises and all...
A profit-Maximising competitive firm uses Just one input, ac. It's production function is g = 40012...
A profit-Maximising competitive firm uses Just one input, ac. It's production function is g = 40012 The price of output is t12 and the factor price is t3 al. What is the profit-maximising quantity of the input? b) What is the profit-Maximising quantity of output ? c) what is the maximum profit achieved
There is a tendency for economic profit in all competitive industries to go to zero. Question...
There is a tendency for economic profit in all competitive industries to go to zero. Question 25 options: a) True b) False If the market price in a competitive market is $10, and a firm's marginal cost (MC) is given by MC = 0.50Q, where Q is units of output, this firm should produce 20 units of output to maximize profit. Question 14 options: a) True b) False As entrepreneurs move resources into and out of industries seeking higher profit...
1. If a profit-maximizing competitive firm has constant returns to scale, then its long-run profits must...
1. If a profit-maximizing competitive firm has constant returns to scale, then its long-run profits must be zero. True or False? Explain your answer. 2. A firm is producing output using one variable factor of production. The firm’s production function is y = 8x¹ˡ². The price of the output is $24 and the price of input is $8 per unit. How many units of the input should the firm use?
Hello below is the question , Many thanks for your help :) A competitive firm uses...
Hello below is the question , Many thanks for your help :) A competitive firm uses two inputs, capital (?) and labour (?), to produce one output, (?). The price of capital, ??, is $1 per unit and the price of labor, ??, is $1 per unit. The firm operates in competitive markets for outputs and inputs, so takes the prices as given. The production function is ?(?,?)=3?0.25?0.25. The maximum amount of output produced for a given amount of inputs...
When the price faced by a firm in a very competitive industry was $5, the firm...
When the price faced by a firm in a very competitive industry was $5, the firm produced nothing in the short run. However, when the price rose to $10, the firm produced 100 tons of output. From this we can infer that. Group of answer choices (a) The firm’s marginal cost curve must be flat (b) The firm’s marginal costs of production never fall below $5 (c) The firm’s average cost of production was less than $10 (d) The firm’s...
When the price of a perfectly competitive firm's output rises: a. the firm will produce less....
When the price of a perfectly competitive firm's output rises: a. the firm will produce less. b. the firm will produce more. c. the firm's marginal cost curve will shift to the left. d. the firm's marginal cost curve will shift to the right.
Question 15 For a perfectly competitive firm, price is less than marginal revenue at all output...
Question 15 For a perfectly competitive firm, price is less than marginal revenue at all output levels price exceeds marginal revenue at all output levels price is less than marginal revenue only at the profit-maximizing quantity price equals marginal revenue only at the profit-maximizing quantity price equals marginal revenue at all output levels
i) A profit-maximising firm faces a downward-sloping demand curve for its output and has marginal...
i) A profit-maximising firm faces a downward-sloping demand curve for its output and has marginal costs that increase with output. Show, on a single diagram, how its profit maximisation decision can be represented both in terms of a feasible set optimisation and its marginal revenue and marginal cost. Why is there a deadweight loss in this case? (5) ii) Now assume the firm is a typical firm in a perfectly competitive market. Show the firm's optimal choice alongside the...
Suppose a perfectly competitive firm produces 2 outputs. The firm’s price for the first output is...
Suppose a perfectly competitive firm produces 2 outputs. The firm’s price for the first output is P1 and the price for the second output is P2. The cost function is given by: C(Q1, Q2) = 2Q12 + 2Q22 a) Give the profit function for the firm. b) Find the FOC’s for profit maximization and interpret them economically. c) Find the SOC’s.
A firm operates in a perfectly competitive market with a price of P = 50 for...
A firm operates in a perfectly competitive market with a price of P = 50 for the product. TVC = 0.5Q3 − 18Q2 + 170Q Q (output) TFC = 300. Write an equation expressing the firm’s total revenue (TR) as function of Q. Write an equation expressing the firm’s total cost (TC), as a function of Q. Write an equation expressing the firm’s profit (π), as a function of Q.Find the first-order condition for the firm’s profit-maximization decision. Find the...
A profit-Maximising competitive firm uses Just one input, ac. It's production function is g = 40012 The price of output is t12 and the factor price is t3 al. What is the profit-maximising quantity of the input? b) What is the profit-Maximising quantity of output ? c) what is the maximum profit achieved
Question 15 For a perfectly competitive firm, price is less than marginal revenue at all output levels price exceeds marginal revenue at all output levels price is less than marginal revenue only at the profit-maximizing quantity price equals marginal revenue only at the profit-maximizing quantity price equals marginal revenue at all output levels
i) A profit-maximising firm faces a downward-sloping demand curve for its output and has marginal costs that increase with output. Show, on a single diagram, how its profit maximisation decision can be represented both in terms of a feasible set optimisation and its marginal revenue and marginal cost. Why is there a deadweight loss in this case? (5) ii) Now assume the firm is a typical firm in a perfectly competitive market. Show the firm's optimal choice alongside the...
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