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3. Refer to the table below. A perfectly competitive firm in the factor and product markets...
Refer to the Table below. a) LexCorp is a perfectly competitive firm that sells its product for $5 per piece. Fill in the col- umns in the table below. Answer: (12 points) MR M C OTR TCProfit 0 0 3 -3 25 15 10 4.5 30 22 b) Use the above table to find the profit-maximizing level of LexCorp's output and its profit- maximizing price. Answer: (8 points) Profit-maximizing quantity: Profit-maximizing price:
Suppose that we have perfectly competitive input markets (for both capital and labor) and output markets. Firm "Tropical Juice" produces orange juice which it sells at $6. The input price that the firm faces is an hourly wage of $5 and the rental rate of $2. Furthermore, the firm currently has a capital stock of 2. Find the labor demanded by the firm in the short run under the following production technologies. a) f(k,l) = k0.1l0.9 b) f(k,l) = max{k,...
A perfectly competitive firm uses a single input (labor) to produce a good according to a production function Q(L) = 2/7 , where Lis the amount of labor it uses. The good sells for $180 per unit (price). The input costs $15 per unit (wage). 1. (20 pts) What is the profit-maximizing amount of input (L)? 2. (10 pts) What is the profit-maximizing amount of output (Q)? 3. (10 pts) How much profit does the firm make when it maximizes...
The equilibrium price at which a perfectly competitive firm sells its good is $8. The profit-maximizing quantity of output is 200 units. At this quantity of output, the firm has an average fixed cost of $4 and an average variable cost of $s. In the short this perfectly competitive firm should
2. For the production schedule of firm in perfectly competitive input and output markets given below, answer the following: Units of Labor Total Output Units of Labor Total Output 19 21 22 12 16 a) If the price of output is $50 per unit, find the specific values of the Marginal Revenue Product and the quantity of labor the firm hires if the market wage is $75 (1 point) b) If the price of output changes to $30, explain how...
Leadbelly Co. Sells pencils in a perfectly competitive product market and hires in a perfectly competitive labor market. assume that the market wage rate for workers is $150 per day. A. What rule should Leadbelly follow to hire the profit-maximizing amount of labor? B. At the profit-maximizing level of output, the marginal product of the last work or hired is 30 boxes of pencils per day. Calculate the Price of a box of pencils. C. Draw a diagram of the...
A firm sells its product in a perfectly competitive market where other firms charge a price of $80 per unit. The firm’s total costs are 20+2Q+Q2. The profit-maximizing output for your firm is: 202Q+Q2
3. Unlike a perfectly competitive firm, the monopolistic competitive firm is able to (a little) control price. Discuss, why, the position of the firm in the long run, is similar to that of a perfectly competitive one. 4. List the characteristics of a monopolistically competitive market structure. 5. Describe the firm's decision in choosing the profit maximizing or loss minimizing level of output. Illustrate.
a firm in perfectly competitive market sells all its products Q at constant price p (1)A firm in a perfectly competitive market sells all its product (Q) at a constant price (P) of $60. Suppose the total cost function (TC) for this firm is described by the following equation: 2 3 TC(Q) = 128 +690 - 140 + Q (a)Form the profit function and determine the output that maximizes the firm's profit. Evaluate the second order condition to assure that...
15. Use the following figure for a firm in a perfectly competitive market. a What is the output that maximizes the firm's profit? b. At the profit-maximizing output, calculate total revenue and total cost. C. If the firm maximizes profit, how much profit does it earn? d. What will likely happen to market demand or market supply in the long run? e. What will likely happen to the market price in the long run? Price (s) d = P =...