Illustrate and explain using diagrams, the difference between long run supply in a constant cost individual...
Illustrate and explain using diagrams, the difference between
long run supply in a constant cost individual firm and industry and
an increasing cost firm and industry.
(Firm level diagrams 2.5 marks; industry level diagrams 2.5 marks,
firm level explanation 2.5 marks, industry level explanation 2.5
diagrams)
Homework Answers
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Illustrate and explain using diagrams, the difference between
long run supply in a constant cost individual...
5. Explain the difference between the long-run aggregate supply curve and the short-run aggregate supply curve
5. Explain the difference between the long-run aggregate supply curve and the short-run aggregate supply curve
Cost curves, profits/losses, and long-run equilibrium: a. Draw typical short run average cost and marginal cost...
Cost curves, profits/losses, and long-run equilibrium: a. Draw typical short run average cost and marginal cost curves for a firm (costs on the vertical axis, q on the horizontal axis), such that marginal cost = average cost= 6 at q=10. b. Suppose this firm operates as a perfect competitor in a market with a short run equilibrium price of $5. Illustrate on your graph the area indicating the short run profit or loss experienced by this firm, given the cost...
2 0) Draw and label a supply and demand diagram with a short run supply curve....
2 0) Draw and label a supply and demand diagram with a short run supply curve. (ii) Shift out the demand curve and show the short run effect on output and price. (iii) Show the long run effect on price by drawing a second short run supply curve. Use this short run supply curve to trace out the position of the long run supply curve. Do (). (ii) and a. a constant cost industry and b. an increasing cost industry...
QUESTION 40 An increasing-cost industry will have a perfectly inelastic long-run supply curve. an upward sloping...
QUESTION 40 An increasing-cost industry will have a perfectly inelastic long-run supply curve. an upward sloping supply curve in the long run. a perfectly elastic long-run supply curve. an upward sloping demand curve in the long run. QUESTION 41 An industry in which an increase in output leads to a reduction in long-run per-unit costs is a(n) increasing-cost industry. constant-cost industry. break-even cost industry. decreasing-cost industry.
1) Draw a long-run average cost curve a firm that exhibits increasing returns and then constant...
1) Draw a long-run average cost curve a firm that exhibits increasing returns and then constant returns. What are the major factors contributing to increasing returns? 2) "A competitive firm will never operate where marginal cost is less than average variable cost." Draw a diagram to illustrate this point and explain it
long-run equilibrium diagram
Using diagrams for both the industry and a representative firm, illustrate competitive long-run equilibrium. Assume constant costs. Given the change indemand in the diagram on the left, show how this affects the representative firm. (draw line)
11. Using aggregate demand, short-run aggregate sup- ply, and long-run aggregate supply curves, explain the process...
11. Using aggregate demand, short-run aggregate sup- ply, and long-run aggregate supply curves, explain the process by which each of the following economic - TEMO alderen events will move the economy from one l. macroeconomic equilibrium to another mu with diagrams. In each case, what are the and long-run effects on the aggregate price lev aggregate output? m one long-run other. Illustrate are the short-run te price level and a. There is a decrease in households' wealth due to decline...
Explain why the industry supply curve is not the long-run industry marginal cost curve. The industry...
Explain why the industry supply curve is not the long-run industry marginal cost curve. The industry supply curve is not the long-run industry marginal cost curve because O A. production will only occur along the long-run marginal cost curve for prices above average variable cost. O B. at prices above the minimum long-run average cost of production, firms will exit the industry. O C. production will only occur along the long-run marginal cost curve when profits are earned. O D....
If the long-run market supply curve in a perfectly competitive industry is upward sloping, then the...
If the long-run market supply curve in a perfectly competitive industry is upward sloping, then the industry: -is a constant-cost industry. -is an increasing-cost industry. -exhibits constant returns to scale. -exhibits increasing returns to scale. -is a decreasing-cost industry.
All firms in a competitive industry have the following (firm-level) long-run total cost curve: C(q) =...
All firms in a competitive industry have the following (firm-level) long-run total cost curve: C(q) = q3–10q2 + 36q where q is the output of the firm. a. Compute the long run equilibrium price. What does the long-run supply curve look like if this is a constant cost industry? Explain. b. Suppose the market demand is given by Q = 111–p. Determine the long-run equilibrium number of firms in the industry.
2 0) Draw and label a supply and demand diagram with a short run supply curve. (ii) Shift out the demand curve and show the short run effect on output and price. (iii) Show the long run effect on price by drawing a second short run supply curve. Use this short run supply curve to trace out the position of the long run supply curve. Do (). (ii) and a. a constant cost industry and b. an increasing cost industry...
QUESTION 40 An increasing-cost industry will have a perfectly inelastic long-run supply curve. an upward sloping supply curve in the long run. a perfectly elastic long-run supply curve. an upward sloping demand curve in the long run. QUESTION 41 An industry in which an increase in output leads to a reduction in long-run per-unit costs is a(n) increasing-cost industry. constant-cost industry. break-even cost industry. decreasing-cost industry.
Using diagrams for both the industry and a representative firm, illustrate competitive long-run equilibrium. Assume constant costs. Given the change indemand in the diagram on the left, show how this affects the representative firm. (draw line)
11. Using aggregate demand, short-run aggregate sup- ply, and long-run aggregate supply curves, explain the process by which each of the following economic - TEMO alderen events will move the economy from one l. macroeconomic equilibrium to another mu with diagrams. In each case, what are the and long-run effects on the aggregate price lev aggregate output? m one long-run other. Illustrate are the short-run te price level and a. There is a decrease in households' wealth due to decline...
Explain why the industry supply curve is not the long-run industry marginal cost curve. The industry supply curve is not the long-run industry marginal cost curve because O A. production will only occur along the long-run marginal cost curve for prices above average variable cost. O B. at prices above the minimum long-run average cost of production, firms will exit the industry. O C. production will only occur along the long-run marginal cost curve when profits are earned. O D....
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