Additional Problem #2 Base Model Outcome and Evaluation Cost Structure TC = 2.5Q2 + 10 Revenue...
Additional Problem #2 Base Model Outcome and Evaluation
Cost Structure TC = 2.5Q2 + 10
Revenue Structure Q = 10 - .4P
Evaluation:
6. Quantity 7. Price 8. Consumer Surplus 9. Producer Surplus 10. Total Surplus 11. Dead-weight Loss
Homework Answers
Inverse demand is P = 25 - 2.5Q
From the information provided, we have Marginal cost MC = 5Q and marginal revenue MR = 25 - 5Q
At profit maximizing output MR = MC
25 - 5Q = 5Q
Q = 25/10 = 2.5 units
Price = 25 - 2.5*2.5 = $18.75
Consumer surplus = 0.5*(Max price - price paid)*qty = 0.5*(25 - 18.75)*2.5 = 7.8125
Producer surplus = area of trapezium so formed = 0.5*(18.75 - 0 + 18.75 - 12.5)*2.5 = 31.25
Total surplus = CS + PS = 39.0625
Dead weight loss = 0.5*(price - MC)*qty = 0.5*(18.75 - 12.5)*(3.33 - 2.5) = 2.60
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Additional Problem #2 Base Model Outcome and Evaluation
Cost Structure TC = 2.5Q2 + 10
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PM that a monopolist will choose in this market.
Calculate consumer surplus (CS), producer surplus (PS), and the
deadweight loss (DWL) resulting from the monopoly. Graphical
Solution would suffice!
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i need help with number 2 a- d 1) Suppose the second-hand market for concert tickets is perfectly competitive and t...
i need help with number 2 a- d
1) Suppose the second-hand market for concert tickets is perfectly competitive and there are primarily 10 online websites where consumers can buy tickets. The following describes the market demand for concerts and the cost of selling tickets. Market Demand: Q = 480 - 4p. Cost to Fim: c(q) = 2.57% + 100. Market Structure: Perfect Competition with N = 10 in the short-run. 2) In the above question, suppose Ticketmaster bought all...
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Problem Setup
Analyze each of the following three scenarios (Efficient, A, and
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Consider the market for widgets. Consumers have a market
(aggregate)
marginal benefit curve of MB = 50 – 3Q. The supplier(s) in that
market have a market (aggregate) marginal cost curve of MC = 10 +
2Q.
Efficient Outcome
● Use the marginal benefit and marginal cost equations given
above to determine the efficient quantity
Equilibrium with Marginal Cost Pricing (Scenario
A)...
*PLEASE ONLY DO #3 BASED OFF #2, #2 has been done. Thank you! 2) Total Cost...
*PLEASE ONLY DO #3 BASED OFF #2, #2 has been done. Thank
you!
2)
Total Cost (TC) = 250+ q +0.004q2
Demand: p = 8 - 0.001Q
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the marginal cost.
MC = dTC/dq
MC = 1+0.008q
TR = P*Q
TR = 8Q – 0.001Q2
Marginal Revenue(MR) = dTR/dQ
MR = 8-0.002Q
Therefore,
1+0.008q = 8 – 0.002q
0.01q = 7
q = 700
Price = 8 – 0.001*700
Price =...
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1) Suppose the second-hand market for concert tickets is perfectly competitive and there are primarily 10 online websites where consumers can buy tickets. The following describes the market demand for concerts and the cost of selling tickets. Market Demand: Q = 480 - 4p. Cost to Fim: (q) = 2.57% + 100. Market Structure: Perfect Competition with N = 10 in the short-run. 2) In the above question, suppose Ticketmaster bought all the second-hand ticketing websites, so...
Suppose that market demand for a good is given by
QD(P) = 10−P. The total cost of production is TC(Q) =
2Q2. Determine quantity QM and price
PM that a monopolist will choose in this market.
Calculate consumer surplus (CS), producer surplus (PS), and the
deadweight loss (DWL) resulting from the monopoly. Graphical
Solution would suffice!
1) (25 points) Suppose that market demand for a good is given by Q”(P) - 10-P. The total cost of production is TCQ) =...
i need help with number 2 a- d
1) Suppose the second-hand market for concert tickets is perfectly competitive and there are primarily 10 online websites where consumers can buy tickets. The following describes the market demand for concerts and the cost of selling tickets. Market Demand: Q = 480 - 4p. Cost to Fim: c(q) = 2.57% + 100. Market Structure: Perfect Competition with N = 10 in the short-run. 2) In the above question, suppose Ticketmaster bought all...
Problem Setup
Analyze each of the following three scenarios (Efficient, A, and
B) describing the market for widgets.
Consider the market for widgets. Consumers have a market
(aggregate)
marginal benefit curve of MB = 50 – 3Q. The supplier(s) in that
market have a market (aggregate) marginal cost curve of MC = 10 +
2Q.
Efficient Outcome
● Use the marginal benefit and marginal cost equations given
above to determine the efficient quantity
Equilibrium with Marginal Cost Pricing (Scenario
A)...
*PLEASE ONLY DO #3 BASED OFF #2, #2 has been done. Thank
you!
2)
Total Cost (TC) = 250+ q +0.004q2
Demand: p = 8 - 0.001Q
a) The monopolist will produce where the marginal revenue equals
the marginal cost.
MC = dTC/dq
MC = 1+0.008q
TR = P*Q
TR = 8Q – 0.001Q2
Marginal Revenue(MR) = dTR/dQ
MR = 8-0.002Q
Therefore,
1+0.008q = 8 – 0.002q
0.01q = 7
q = 700
Price = 8 – 0.001*700
Price =...
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