Homework Answers
c is correct
Point Y is the short run equilibrium because in long run equilibrium price is always P2 which implies that Z is a long run equilibrium.
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Figure 14-14 (a) MC (b) SOS1 D1 DO Q2 Q3 Quantity QW Q YOX Q2 Quantity...
Figure 14-14 Price Price MC SO S1 ATC P3 P3 w 22 P2 P1 P1 D1...
Figure 14-14 Price Price MC SO S1 ATC P3 P3 w 22 P2 P1 P1 D1 DO Q2 03 Duextity QW QYQX QZ Quantity Refer to Figure 14-14. Assume that the market starts in equilibrium at point W in panel (b) and that panel (a) illustrates the cost curves facing individual firms. Suppose that demand increases from DO to D1. Which of the following statements is correct? Points W. Y, and Z represent long-run equilibria. Points W, Y, Z, and...
QUESTION 11 Use the figure below to answer the question that follows 1 Price Price (a)...
QUESTION 11 Use the figure below to answer the question that follows 1 Price Price (a) MC 6) SOS1 ATC 02 03 Quantity QW QYOX QZ Quantity Assume that the market starts in equilibrium at point W in panel(b). An increase in demand from Doto D1 will result in: a. Rising prices and failing profits in the market and new long-run equilibrium at point b. An eventual increase in the number of firms in the market and a new long-run...
Price S2 S1 Quantity Refer to Figure 3-8. The graph in this figure illustrates an initial...
Price S2 S1 Quantity Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D1 and 52 (point B). Assume that Motorcycles are a normal good. If there is an increase in number of companies producing motorcycles and a decrease in income (assume motorcycles are a normal good), the equilibrium could move to which point? ΟΑ) Α ОВ) в 0 O C) c OD E Panel (a)...
Refer to Figure 14-7. Assume that the market starts in equilibrium at point A in panel...
Refer to Figure 14-7. Assume that the market
starts in equilibrium at point A in panel (b). An increase in
demand from Demand0 to Demand1 will result
in
a) an eventual increase in the number of firms in the market and
a new long-run equilibrium at point D.
b) rising prices and falling profits for existing firms in the
market.
c) prices and falling profits for existing firms in the
market.
d) a new market equilibrium at...
Refer to the figure below. 0 Q2 Q Q3 Quantity If a price ceiling were imposed...
Refer to the figure below. 0 Q2 Q Q3 Quantity If a price ceiling were imposed at point G, then excess demand would be measured by the distance between points: Select one: a. G and b. F and l c. K and d. F andK
Figure 14-5 Suppose a firm operating in a competitive market has the following cost curves: MC...
Figure 14-5 Suppose a firm operating in a competitive market has the following cost curves: MC ATC 27 AVC P6 BA P3 P2 P1 01 02 03 04 os இகனாது Refer to Figure 14-5. When market price is P7, a profit-maximizing firm's short-run profits can be represented by the area P7 x Q5 b. P7 x Q3 (P7-P5) x Q3 d. We are unable to determine the firm's profits because the quantity that the firm would produce is not labeled...
1) The above figure definitely shows a) a long-run equilibrium for a monopolistically competitive firm. b)...
1) The above figure definitely shows
a) a long-run equilibrium for a monopolistically competitive
firm.
b) an industry with few firms.
c) a long-run equilibrium for a perfectly competitive firm.
d) a long-run equilibrium for a perfectly competitive market.
2) The firm in the above figure has a markup of ________ per
meal.
a) $0
b) $4
c) $8
d) $10
3) According to the graph bellow:
Q1 to Q2 // Q2 to Q3 // Q4 to Q5
a) The...
the figure at right. The market equilibrium quantity is Q. Point Q2 represents the optimal amount...
the figure at right. The market equilibrium quantity is Q. Point Q2 represents the optimal amount of production. Refer The government can achieve the optimal outcome by consumers equal to OA. providing a per-unit subsidy P2 P1 P3 O B. providing a per-unit subsidy Рз - P1- consumers equal to P2 P. O C. setting the price at P3. O D. establishing a tax equal to P2 -P1 per unit of the good sold. D2 D. а, а Quantity Price...
QUESTION 3 Figure Price Supply P K I P" P B M N Demand Quantity Refer...
QUESTION 3 Figure Price Supply P K I P" P B M N Demand Quantity Refer to Figure. If the government imposes a tax size of P- P" in the above market then the area L+M+Y represents a. consumer surplus after the tax. producer surplus after the tax. Cconsumer surplus before the tax. producer surplus before the tax. QUESTION 4 4 point Figure Supply Dennd Quantity Q1 02 Q3 Q Qs Refer to Figure. If the government impose a tax...
Part B Short Answer questions (14 points) Q.1 Consider the following graph which shows the cost...
Part B Short Answer questions (14 points) Q.1 Consider the following graph which shows the cost curves of a firm. MC YO NGS ATC AVC Q, QQ, Q QQ (a) is the firm operating in short run or long run? Explain () Is the gap between ATC and AVC increasing or decreasing over quantity? Explain. (c) Suppose wages increase, does AFC increase or not? Explain. (Suppose rental payment increases, does MC increase or not? Explain. ) On a separate graph,...
Figure 14-14 Price Price MC SO S1 ATC P3 P3 w 22 P2 P1 P1 D1 DO Q2 03 Duextity QW QYQX QZ Quantity Refer to Figure 14-14. Assume that the market starts in equilibrium at point W in panel (b) and that panel (a) illustrates the cost curves facing individual firms. Suppose that demand increases from DO to D1. Which of the following statements is correct? Points W. Y, and Z represent long-run equilibria. Points W, Y, Z, and...
QUESTION 11 Use the figure below to answer the question that follows 1 Price Price (a) MC 6) SOS1 ATC 02 03 Quantity QW QYOX QZ Quantity Assume that the market starts in equilibrium at point W in panel(b). An increase in demand from Doto D1 will result in: a. Rising prices and failing profits in the market and new long-run equilibrium at point b. An eventual increase in the number of firms in the market and a new long-run...
Price S2 S1 Quantity Refer to Figure 3-8. The graph in this figure illustrates an initial competitive equilibrium in the market for motorcycles at the intersection of D1 and 52 (point B). Assume that Motorcycles are a normal good. If there is an increase in number of companies producing motorcycles and a decrease in income (assume motorcycles are a normal good), the equilibrium could move to which point? ΟΑ) Α ОВ) в 0 O C) c OD E Panel (a)...
Refer to Figure 14-7. Assume that the market
starts in equilibrium at point A in panel (b). An increase in
demand from Demand0 to Demand1 will result
in
a) an eventual increase in the number of firms in the market and
a new long-run equilibrium at point D.
b) rising prices and falling profits for existing firms in the
market.
c) prices and falling profits for existing firms in the
market.
d) a new market equilibrium at...
Refer to the figure below. 0 Q2 Q Q3 Quantity If a price ceiling were imposed at point G, then excess demand would be measured by the distance between points: Select one: a. G and b. F and l c. K and d. F andK
Figure 14-5 Suppose a firm operating in a competitive market has the following cost curves: MC ATC 27 AVC P6 BA P3 P2 P1 01 02 03 04 os இகனாது Refer to Figure 14-5. When market price is P7, a profit-maximizing firm's short-run profits can be represented by the area P7 x Q5 b. P7 x Q3 (P7-P5) x Q3 d. We are unable to determine the firm's profits because the quantity that the firm would produce is not labeled...
1) The above figure definitely shows
a) a long-run equilibrium for a monopolistically competitive
firm.
b) an industry with few firms.
c) a long-run equilibrium for a perfectly competitive firm.
d) a long-run equilibrium for a perfectly competitive market.
2) The firm in the above figure has a markup of ________ per
meal.
a) $0
b) $4
c) $8
d) $10
3) According to the graph bellow:
Q1 to Q2 // Q2 to Q3 // Q4 to Q5
a) The...
the figure at right. The market equilibrium quantity is Q. Point Q2 represents the optimal amount of production. Refer The government can achieve the optimal outcome by consumers equal to OA. providing a per-unit subsidy P2 P1 P3 O B. providing a per-unit subsidy Рз - P1- consumers equal to P2 P. O C. setting the price at P3. O D. establishing a tax equal to P2 -P1 per unit of the good sold. D2 D. а, а Quantity Price...
QUESTION 3 Figure Price Supply P K I P" P B M N Demand Quantity Refer to Figure. If the government imposes a tax size of P- P" in the above market then the area L+M+Y represents a. consumer surplus after the tax. producer surplus after the tax. Cconsumer surplus before the tax. producer surplus before the tax. QUESTION 4 4 point Figure Supply Dennd Quantity Q1 02 Q3 Q Qs Refer to Figure. If the government impose a tax...
Part B Short Answer questions (14 points) Q.1 Consider the following graph which shows the cost curves of a firm. MC YO NGS ATC AVC Q, QQ, Q QQ (a) is the firm operating in short run or long run? Explain () Is the gap between ATC and AVC increasing or decreasing over quantity? Explain. (c) Suppose wages increase, does AFC increase or not? Explain. (Suppose rental payment increases, does MC increase or not? Explain. ) On a separate graph,...
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