Assume that the following cost data are for a purely competitive producer: Total Product Avg. Fixed...
Assume that the following cost data are for a purely competitive producer:
| Total Product | Avg. Fixed Cost | Avg. Var. Cost | Avg. Total Cost | Marg. Cost |
| 0 | n/a | $0.00 | $0.00 | n/a |
| 1 | $60.00 | $45.00 | $105.00 | $45.00 |
| 2 | $30.00 | $42.50 | $72.50 | $40.00 |
| 3 | $20.00 | $40.00 | $60.00 | $35.00 |
| 4 | $15.00 | $37.50 | $52.50 | $30.00 |
| 5 | $12.00 | $37.00 | $49.00 | $35.00 |
| 6 | $10.00 | $37.50 | $47.50 | $40.00 |
| 7 | $8.57 | $38.57 | $47.14 | $45.00 |
| 8 | $7.50 | $40.63 | $48.13 | $55.00 |
| 9 | $6.67 | $43.33 | $50.00 | $65.00 |
| 10 | $6.00 | $46.50 | $52.50 | $75.00 |
Answer the questions in the first column in the table below for the
price listed at the top of each of the other three columns.
Instructions: If you are entering any negative
numbers be sure to include a negative sign (-) in front of those
numbers. Select "Not applicable" and enter a value of "0" for
output if the firm does not produce.
| (a) At a product price of $68.00 |
(b) At a product price of $43.00 |
(c) At a product price of $34.00 |
|
| Will this firm produce in the short run? | (Click to select) Yes No | (Click to select) Yes No | (Click to select) Yes No |
|
If it is preferable to produce, what will be the profit-maximizing or loss-minimizing output? |
(Click to select) Loss-minimizing Not
applicable Profit-maximizing |
(Click to select) Profit-maximizing Not
applicable Loss-minimizing |
(Click to
select) Profit-maximizing Loss-minimizing Not
applicable |
| What economic profit or loss will the firm realize per unit of output? |
(Click to select) Not
applicable Loss Profit |
(Click to
select) Loss Profit Not
applicable |
(Click to select) Total profit Total
loss |
d. In the table below, complete the short-run supply schedule for
the firm (columns 1 and 2) and indicate the profit or loss incurred
at each output (column 3).
Instructions: Enter your answers as whole numbers.
If you are entering any negative numbers be sure to include a
negative sign (-) in front of those numbers.
| (1) | (2) | (3) | (4) |
| Price | Quant. Supplied, Sing. Firm | Profit (+), Loss (-) | Quant. Supplied, 1,500 Firms |
| $24.00 | |||
| 29.00 | |||
| 34.00 | |||
| 41.00 | |||
| 46.00 | |||
| 57.00 | |||
| 68.00 |
e. Now assume that there are 1,500 identical firms in this
competitive industry; that is, there are 1,500 firms, each of which
has the cost data shown in the table. Complete the industry supply
schedule (column 4 in the table above).
f. Suppose the market demand data for the product are as
follows:
| Price | Total Quantity Demanded |
| $24.00 | 17000 |
| 29.00 | 15000 |
| 34.00 | 13500 |
| 41.00 | 12000 |
| 46.00 | 10500 |
| 51.00 | 9500 |
| 56.00 | 8000 |
What will be the equilibrium price? $ .
What will be the equilibrium output for the
industry? .
For each firm? units.
Instructions: Round your answers to 2 decimal
places. Enter positive values for profit or loss.
What will profit or loss be per unit? (Click to
select) Loss Profit per unit =
$ .
Per firm? $ .
Will this industry expand or contract in the long
run? (Click to
select) Expand Contract .
Homework Answers
Setting P=MC,the firm will produce when the price is equal to or more than its minimum AVC
Profit/loss per unit = Price - ATC
Total profit/loss = P-ATC*Q
When the price is less than its minimum AVC,it will shut down and incur loss equal to its fixed cost
| (a) At a product price of $68.00 |
(b) At a product price of $43.00 |
(c) At a product price of $34.00 |
|
| Will this firm produce in the short run? | Yes | Yes | No |
|
If it is preferable to produce, what will be the profit-maximizing or loss-minimizing output? |
Profit-maximizing |
Loss-minimizing |
Not applicable |
| What economic profit or loss will the firm realize per unit of output? |
Profit Total profit = 18*9=162 |
Loss Total loss = -4.5*6 = -27 |
Total loss |
d) and e)
| (1) | (2) | (3) | (4) |
| Price | Quant. Supplied, Sing. Firm | Profit (+), Loss (-) | Quant. Supplied, 1,500 Firms |
| $24.00 | 0 | -60 | 0 |
| 29.00 | 0 | -60 | 0 |
| 34.00 | 0 | -60 | 0 |
| 41.00 | 6 | 41-47.50*6= -39 | 9000 |
| 46.00 | 7 | 46-47.14*7 = -7.98 | 10500 |
| 57.00 | 8 | 57-48.13*8 = 70.96 | 12000 |
| 68.00 | 9 | +162 | 13500 |
f) Equilibrium price = $46 where QD=QS
What will be the equilibrium output for the industry? 10500
For each firm? 7 units
What will profit or loss be per unit?
Loss per unit = 46-47.14 = -1.14
Per firm? -1.14*7 = -7.98
Will this industry expand or contract in the long run? Contract
because the firms are making losses,some firms will exit the
market
Add Answer to:
Assume that the following cost data are for a purely competitive
producer:
Total Product
Avg. Fixed...
Assume the following cost data are for a purely competitive producer: Total Average Average Product Fixed...
Assume the following cost data are for a purely competitive producer: Total Average Average Product Fixed Cost Variable Cost Average Total Cost Marginal Cost COVOAN $60.00 30.00 20.00 15.00 12.00 10.00 8.57 7.50 6.67 6.00 $45.00 42.50 40.00 37.50 37.00 37.50 38.57 40.63 43.33 46.50 $105.00 72.50 60.00 52.50 49.00 47.50 47.14 48.13 50.00 52.50 $45.00 40.00 35.00 30.00 35.00 40.00 45.00 55.00 65.00 75.00 Answer the following questions (a - c) using the table above. Instructions: 1. For any...
Assume the following cost data are for a purely competitive producer: Average Product Fixed Cost Variable...
Assume the following cost data are for a purely competitive producer: Average Product Fixed Cost Variable Cost Total Cost Average Average Marginal Total Cost $60.00 $45.00 $105,00 $45.00 1 72.50 2 30.00 42.50 40.00 3 20.00 40.00 60.00 35.00 30.00 15.00 37.50 52.50 5 12.00 37.00 49.00 35.00 6 10.00 37.50 47.50 40.00 8.57 7 38.57 47.14 45.00 7.50 40.63 48.13 50.00 55.00 9 6.67 43.33 65.00 10 6.00 46.50 52.50 75.00 Answer the following questions (a - c) using...
Assume that the following cost data are for a purely competitive producer: total product average fixed...
Assume that the following cost data are for a purely competitive
producer:
total
product
average
fixed
cost
average
variable
cost
average
total
coast
marginal
cost
0
na
$0.00
$0.00
na
1
$60.00
$45.00
$105.00
$45.00
2
$30.00
$42.50
$72.50
$40.00
3
$20.00
$40.00
$60.00
$35.00
4
$15.00
$37.50
$52.00
$30.00
5
$12.00
$37.00
$49.00
$35.00
6
$10.00
$37.50
$47.50
$40.00
7
$8.57
$38.57
$47.14
$45.00
8
$7.50
$40.63
$48.13
$55.00
9
$6.67
$43.33
$50.00
$65.00
10
$6.00
$46.50
$52.50
$75.00...
Assume that the cost data in the following table are for a purely competitive producer:
Assume that the cost data in the following table are for a purely competitive producer: TotalProductAverageFixed CostAverageVariable CostAverageTotal CostMarginal Cost01$60.00$45.00$105.00$45.00230.00 42.50 72.5040.00320.00 40.00 60.0035.00415.00 37.50 52.5030.00512.00 37.00 49.0035.00610.00 37.50 47.5040.0078.57 38.57 47.1445.008 7.50 40.63 48.1355.009 6.67 43.33 50.0065.0010 6.00 46.50 52.5075.00 Instructions: If you are entering any negative numbers be sure to include a negative sign (−) in front of those numbers. Select "Not applicable" and enter a value of "0" for output if the firm does not produce. a. At a product price of $66.00 (i) Will this firm produce in the short run? (Click to select) No Yes (ii) If it is preferable to produce, what...
Assume that the following cost data are for a purely competitive producer Total Product Average Fixed...
Assume that the following cost data are for a purely competitive producer Total Product Average Fixed Cost Marginal Cost na $ 45,00 $ 40,00 1 2 5 5 6 0.00 3 0.00 20.00 15.00 Average Average Total Variable Cost Cost 0.00 $ 0.00 $ 45,00 $ 105,00 $ 42.50 $ 72.50 $ 40.00 $ 60.00 $ 37.50 17 505 $ 5250 $ 37005 4 9.00 $ 3750 $ 4750 $ 38.575 $ 4063 $ 48.13 $ 4333 5 0.00 $...
Assume that the following cost data are for a purely competitive producer: Average Fixed Average Average Total...
Assume that the following cost data are for a purely competitive producer: Average Fixed Average Average Total Variable Cost Marginal Cost Total Product Cost Cost 000 S 0.00 na na 45.00 S 105.00 72.50 $ 45.00 60,00 S 42.50 S 40.00 30.00 S 6000 S 35.00 2000 S 40.00 S 52.50 S 30.00 15.00 $ 3760 S 3500 49.00 $ 12.00 S 37.00 S 1000$ 37.50 S 47.50 S 47.14 S 40.00 3857 S 45.00 857 $ 48.13 S 55.00 4063...
Assume that the following cost data are for a purely competitive producer Total Product Average Fixed...
Assume that the following cost data are for a purely competitive producer Total Product Average Fixed Average Average Total Marainal cos Cost Variable Cost Cost na 0.00 $ 0.00 na $ 60.00 $ 45.00 $ 105.00 $ 45.00 $ 30.00 $ 42.50 $ 72.50 $ 40.00 $ 20.00 $ 40.00 $ 60.00 $ 35.00 $ 15,00 $ 37.50 $ 52.50 $ 30.00 12.00 $ 37.00 $ 49.00 $ 35.00 10.00 $ 37.50 $ 47.50 $ 40.00 $ 8.57 $ 38.57...
Assume that the following cost data are for a perfectly competitive producer: Total Product Marginal Cost...
Assume that the following cost data are for a perfectly competitive producer: Total Product Marginal Cost , Average Fixed Cost na $60.00 30.00 20.00 15.00 12.00 10.00 Average Variable Cost $0.00 $45.00 42.50 40.00 37.50 37.00 37.50 38.57 40.63 43.33 46.50 Average Total Cost $0.00 $105.00 72.50 60.00 52.50 49.00 47.50 47.14 48.13 50.00 52.50 6 8.57 7.50 6.67 .00 106 Answer the questions in the first column in the table below for each of the prices listed at the...
i l Cort Total Product Average Fixed Average Average Total M Cost Variable Cost Cost 0.00...
i l Cort Total Product Average Fixed Average Average Total M Cost Variable Cost Cost 0.00 $ 0.00 S 6 0.00 45.00 S 105.00 S 2 s 30.00 S 42.50 $ 72.50 $ S 20.00 S 40.00 S 60.00 S 15.00 S 37.50 $ 52.50 $ 12.00 S 37.00 S 49.00 S 10.00 S 37.50 S 47.50 S 8.571 $ 38.57 S 47.14 S $ 7.50 S 40.63 S 48.13 S 9S 43.33 S 10 $ 6.00 $ 46.50 $...
Same question/divided into two parts Assume that the following cost data are for a purely competitive...
Same question/divided into two parts
Assume that the following cost data are for a purely competitive producer: as Total Product Average Fixed Total Product Cost 0 na 1 $ 60.00 2 $ 30.00 $ 20.00 $ 15.00 12.00 $ 10.00 $ 8.57 $ 7.50 $ 6.67 10 6 .00 Average Average Total eost Average Total Marginal Cost Variable Cost Cost 0 .00 5 0 .00 na $ 45.00 $ 105.00 $ 45.00 $ 42.50 $ 72.50 $ 40.00 $ 40.00...
Assume the following cost data are for a purely competitive producer: Total Average Average Product Fixed Cost Variable Cost Average Total Cost Marginal Cost COVOAN $60.00 30.00 20.00 15.00 12.00 10.00 8.57 7.50 6.67 6.00 $45.00 42.50 40.00 37.50 37.00 37.50 38.57 40.63 43.33 46.50 $105.00 72.50 60.00 52.50 49.00 47.50 47.14 48.13 50.00 52.50 $45.00 40.00 35.00 30.00 35.00 40.00 45.00 55.00 65.00 75.00 Answer the following questions (a - c) using the table above. Instructions: 1. For any...
Assume the following cost data are for a purely competitive producer: Average Product Fixed Cost Variable Cost Total Cost Average Average Marginal Total Cost $60.00 $45.00 $105,00 $45.00 1 72.50 2 30.00 42.50 40.00 3 20.00 40.00 60.00 35.00 30.00 15.00 37.50 52.50 5 12.00 37.00 49.00 35.00 6 10.00 37.50 47.50 40.00 8.57 7 38.57 47.14 45.00 7.50 40.63 48.13 50.00 55.00 9 6.67 43.33 65.00 10 6.00 46.50 52.50 75.00 Answer the following questions (a - c) using...
Assume that the following cost data are for a purely competitive
producer:
total
product
average
fixed
cost
average
variable
cost
average
total
coast
marginal
cost
0
na
$0.00
$0.00
na
1
$60.00
$45.00
$105.00
$45.00
2
$30.00
$42.50
$72.50
$40.00
3
$20.00
$40.00
$60.00
$35.00
4
$15.00
$37.50
$52.00
$30.00
5
$12.00
$37.00
$49.00
$35.00
6
$10.00
$37.50
$47.50
$40.00
7
$8.57
$38.57
$47.14
$45.00
8
$7.50
$40.63
$48.13
$55.00
9
$6.67
$43.33
$50.00
$65.00
10
$6.00
$46.50
$52.50
$75.00...
Assume that the following cost data are for a purely competitive producer Total Product Average Fixed Cost Marginal Cost na $ 45,00 $ 40,00 1 2 5 5 6 0.00 3 0.00 20.00 15.00 Average Average Total Variable Cost Cost 0.00 $ 0.00 $ 45,00 $ 105,00 $ 42.50 $ 72.50 $ 40.00 $ 60.00 $ 37.50 17 505 $ 5250 $ 37005 4 9.00 $ 3750 $ 4750 $ 38.575 $ 4063 $ 48.13 $ 4333 5 0.00 $...
Assume that the following cost data are for a purely competitive producer: Average Fixed Average Average Total Variable Cost Marginal Cost Total Product Cost Cost 000 S 0.00 na na 45.00 S 105.00 72.50 $ 45.00 60,00 S 42.50 S 40.00 30.00 S 6000 S 35.00 2000 S 40.00 S 52.50 S 30.00 15.00 $ 3760 S 3500 49.00 $ 12.00 S 37.00 S 1000$ 37.50 S 47.50 S 47.14 S 40.00 3857 S 45.00 857 $ 48.13 S 55.00 4063...
Assume that the following cost data are for a purely competitive producer Total Product Average Fixed Average Average Total Marainal cos Cost Variable Cost Cost na 0.00 $ 0.00 na $ 60.00 $ 45.00 $ 105.00 $ 45.00 $ 30.00 $ 42.50 $ 72.50 $ 40.00 $ 20.00 $ 40.00 $ 60.00 $ 35.00 $ 15,00 $ 37.50 $ 52.50 $ 30.00 12.00 $ 37.00 $ 49.00 $ 35.00 10.00 $ 37.50 $ 47.50 $ 40.00 $ 8.57 $ 38.57...
Assume that the following cost data are for a perfectly competitive producer: Total Product Marginal Cost , Average Fixed Cost na $60.00 30.00 20.00 15.00 12.00 10.00 Average Variable Cost $0.00 $45.00 42.50 40.00 37.50 37.00 37.50 38.57 40.63 43.33 46.50 Average Total Cost $0.00 $105.00 72.50 60.00 52.50 49.00 47.50 47.14 48.13 50.00 52.50 6 8.57 7.50 6.67 .00 106 Answer the questions in the first column in the table below for each of the prices listed at the...
i l Cort Total Product Average Fixed Average Average Total M Cost Variable Cost Cost 0.00 $ 0.00 S 6 0.00 45.00 S 105.00 S 2 s 30.00 S 42.50 $ 72.50 $ S 20.00 S 40.00 S 60.00 S 15.00 S 37.50 $ 52.50 $ 12.00 S 37.00 S 49.00 S 10.00 S 37.50 S 47.50 S 8.571 $ 38.57 S 47.14 S $ 7.50 S 40.63 S 48.13 S 9S 43.33 S 10 $ 6.00 $ 46.50 $...
Same question/divided into two parts
Assume that the following cost data are for a purely competitive producer: as Total Product Average Fixed Total Product Cost 0 na 1 $ 60.00 2 $ 30.00 $ 20.00 $ 15.00 12.00 $ 10.00 $ 8.57 $ 7.50 $ 6.67 10 6 .00 Average Average Total eost Average Total Marginal Cost Variable Cost Cost 0 .00 5 0 .00 na $ 45.00 $ 105.00 $ 45.00 $ 42.50 $ 72.50 $ 40.00 $ 40.00...
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