1. For a perfectly competitive firm, long-run average cost is: LAC = 300 - 20Q +...
1. For a perfectly competitive firm, long-run average cost is: LAC = 300 - 20Q + 1.8Q2, where Q denotes the firm’s output. The firm’s long-run profit-maximizing price is _____.
2. Demand for a good is given by: QD = 50 – 2P and supply by QS = 1P – 10, where P is the market price of the good. In equilibrium, price would be ___.
3. Demand for a good is given by: QD = 50 – 2P and supply by QS = 0.8P – 10, where P is the market price of the good. In equilibrium, output under perfect competition will be ____.
Homework Answers
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1. For a perfectly competitive firm, long-run average cost is:
LAC = 300 - 20Q +...
A representative firm with long-run total cost given by TC = 2,000 + 20q + 5q2...
A representative firm with long-run total cost given by TC = 2,000 + 20q + 5q2 operates in a competitive industry where the market demand is given by QD = 10,000 – 40P. Find the long-run equilibrium output of the individual firm. Find the long-run equilibrium price. Find the long-run equilibrium output of the industry.
(a) All firms in a perfectly competitive industry face the same long-run average cost curve, AC...
(a) All firms in a perfectly competitive industry face the same long-run average cost curve, AC = 0.05q – 5 + 500/q, and the same long-run marginal cost curve given by MC = 0.1q – 5. The market demand for the product of these firms is QD = 100,000 – 10,000P. i.Calculate the equilibrium price and quantity. ii.Assuming the market is in long-run equilibrium, how many firms will be on the market? (b) Suppose the demand for cotton T-shirts is...
Suppose you are given the following information about a particular industry in the short run (perfect...
Suppose you are given the following information about a particular industry in the short run (perfect competition): QD = 200 − 2P Market demand QS = −120 + 6P Market supply C(q) = 4 + 30q + q2 Firm total cost function for an individual firm (10 pts) Find the equilibrium price & quantity in the market in the short run. (20 pts) Find the output supplied by the individual firm, and the number of firms in...
For a constant cost industry in which all firms the same cost functions, their long-run average...
For a constant cost industry in which all firms the same cost functions, their long-run average cost is minimized at $10 per unit output and 20 units (i.e. q = 20). Market demand is given by QD=DP=1,500-50P. Find the long-run market supply function Find the long-run equilibrium price (P*), market quantity (Q*), firm output (q*), number of firms (n), and each firm’s profit. The short-run total cost function associated with each firm’s long-run costs is SCq=0.5q2-10q+200. Calculate the short-run average...
9. The long-run supply curve of a perfectly competitive firm is given by a horizontal line...
9. The long-run supply curve of a perfectly competitive firm is given by a horizontal line placed at P = 3 PLN (in a graph where the quantity and price are measured on the X and Y axes, respectively). The market demand is described by QD = 150-5P. a. What is the amount of output produced by the whole industry in the long-run equilibrium? b. Assuming that firms are identical and obtain the minimum average cost for the quantity of...
Answer just part b ) All firms in a perfectly competitive industry face the same long-run...
Answer just part b ) All firms in a perfectly competitive industry face the same long-run average cost curve, AC = 0.05q – 5 + 500/q, and the same long-run marginal cost curve given by MC = 0.1q – 5. The market demand for the product of these firms is QD = 100,000 – 10,000P. i. Calculate the equilibrium price and quantity. ii. Assuming the market is in long-run equilibrium, how many firms will be on the market? (b) Suppose...
Each firm in a perfectly competitive market has long run average cost represented as AC(q) =...
Each firm in a perfectly competitive market has long run average cost represented as AC(q) = 100q- 10+100/q. Long run marginal cost is MC=200q-10. The market demand is Qd = 2150-5P. Find the long run equilibrium output per firm, q*, the long run equilibrium price, P*, and the number of firms in the industry, n*. P = 190; Q = 1200; q =1 , n = 1200
i) The long run cost function for each firm in a perfectly competitive market is c(q)...
i) The long run cost function for each firm in a perfectly competitive market is c(q) = 2^1.5+16q^0.5, LMC = 1.59^0.5+ 8q^-0.5, market demand curve is Q=1600-2p. Find price (p) of output and the level of output (q) produced by the firm in a long run equilibrium. Find the long run average cost curve for the firm. ii) what happens in the long run if the market demand curve shifts to Q=160-20p?/ -A competitive industry is in long run equilibrium....
10. Suppose the demand for gourmet personal pan pizzas is given by the following equation: Qd...
10. Suppose the demand for gourmet personal pan pizzas is given by the following equation: Qd = 11 - 2P where Qd is the amount of pizzas consumers want to buy (i.e., quantity demanded), and P is the price of pizzas. Suppose the supply of gourmet personal pan pizzas is: Qs = 2 + 1P where Qs is the amount of pizzas producers will supply (i.e., quantity supplied). What is the equilibrium market price and quantity of gourmet personal pan...
Suppose the market for canola oil is perfectly competitive. There are 1,000 firms in the market,...
Suppose the market for canola oil is perfectly competitive. There are 1,000 firms in the market, each of which have a fixed cost of FC=2 and a marginal cost of MC= 1+Q, where q is quantity produced by an individual firm. Let QS denote the total quantity supplied in the market. The market demand is QD= 15,250-250P A) Find the market supply equation, that is write QS as a function of price P B)What is the equilibrium price? What is...
9. The long-run supply curve of a perfectly competitive firm is given by a horizontal line placed at P = 3 PLN (in a graph where the quantity and price are measured on the X and Y axes, respectively). The market demand is described by QD = 150-5P. a. What is the amount of output produced by the whole industry in the long-run equilibrium? b. Assuming that firms are identical and obtain the minimum average cost for the quantity of...
i) The long run cost function for each firm in a perfectly competitive market is c(q) = 2^1.5+16q^0.5, LMC = 1.59^0.5+ 8q^-0.5, market demand curve is Q=1600-2p. Find price (p) of output and the level of output (q) produced by the firm in a long run equilibrium. Find the long run average cost curve for the firm. ii) what happens in the long run if the market demand curve shifts to Q=160-20p?/ -A competitive industry is in long run equilibrium....
10. Suppose the demand for gourmet personal pan pizzas is given by the following equation: Qd = 11 - 2P where Qd is the amount of pizzas consumers want to buy (i.e., quantity demanded), and P is the price of pizzas. Suppose the supply of gourmet personal pan pizzas is: Qs = 2 + 1P where Qs is the amount of pizzas producers will supply (i.e., quantity supplied). What is the equilibrium market price and quantity of gourmet personal pan...
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