A perfectly competitive industry consists of many identical firms, each with a long-run total cost function of TC = 500Q-20Q^2+0.5Q^3. a. In long-run equilibrium, how much will each firm produce? b. What is the long-run equilibrium price? c. The industry's demand curve is ?? = 48,000 − 60?. How many firms are in the I ndustry? d. If the industry demand decreases to ?? = 30,000 − 80? how will the industry respond?
Q: firm in a perfectly competitive market: а. What is profit for this firm if price = $22? Make sure to…
A: Q MC($) AVC($) ATC($) 0 40 12.50 12.50 35.00 100 8.33 10.00 19.00 130 16.66 11.53…
Q: The figure to the right represents the cost structure for a perfectly competitive firm with its…
A: In a competitive firm there are large number of firms selling identical products thus having no…
Q: Suppose the price determined by the market is 1.5. Assume a perfectly competitive industry. Show all…
A: The firm would minimize the loss or maximize the profit at the output level where marginal revenue…
Q: n the long run, perfectly competitive firms are at equilibrium when: (LMC = Long-Run Marginal Cost;…
A: Under a perfectly competitive market structure, the firms are price takers who accept the market…
Q: Q10. Label and complete the following daily cost schedule for Company A as directed by the Quiz…
A: Total Cost = Fixed Cost + Variable Cost Fixed Cost is the cost incurred by the firm that does not…
Q: A perfectly competitive firm does not increase its quantity of output without limit, even though it…
A: Answer: Introduction: A perfectly competitive firm is a price taker. In perfect competition, firms…
Q: must each perfectly competitive firm be in equilibrium if the industry is in the long-run…
A: Perfect competition refers to the situation where there are large number of prouder and consumers…
Q: What is the short-run Shutdown condition for a perfectly competitive firm? P>AVCminimum…
A: In a market, a shutdown point refers to the point at which a firm is unable to recover its operating…
Q: In a short-run perfectly competitive market of tomatoes, when P=$9, firm X produces 0 and firm Y…
A: Perfect competition is the market condition where there are large number if buyer and seller are…
Q: A perfectly competitive firm, with MC=q operates in a market character,zed by the following market…
A: In economics, profit maximization is the short run or long run process by which a firm may determine…
Q: A perfectly competitive firm currently sells each unit of output at $3 and faces an average total…
A: In a market, a perfectly competitive firm is one that has to accept the market price and sell all…
Q: The long-run supply curve of a perfectly competitive industry with increasing costs is: a)…
A: Perfectly competitive industry is the one where there are large number of buyers and sellers with…
Q: A firm operates in a perfectly competitive market. Its marginal cost = to its marginal revenue. It…
A: Given marginal revenue= marginal cost, there would be three cases in perfect competition: One where…
Q: In a perfectly competitive industry, what mechanism that adjusts price to minimum long-run average…
A: Firms are considered perfect competition when these conditions happen: (i) the industry consists of…
Q: A perfectly competitive firm sells its output for $0.99 per unit. At 10,000 units of output per…
A: Under a perfectly competitive market, there are a large number of buyers and sellers. Each seller…
Q: 70. In a perfectly competitive market, industry demand is given by Q = 1000 – 20P. The typical…
A: In a competitive industry there are large number of firms producing identical products thus each…
Q: Assuming that the CD manufacturing business is a perfectly competitive industry, explain why his…
A: The perfectly competitive market is the market structure where a large number of firms compete in…
Q: In a perfectly competitive market, in the short-run, a firm shuts down if Their average cost is less…
A: A perfect competition market refers to the ideal market. This type of structure includes a variety…
Q: Assuming a horizontal long-run market supply curve, which of the following statements is (are) TRUE…
A: In the long run, a perfectly competitive firm produces at a level of output where P = MC = AC. At…
Q: Question 9 Which of the following is(are) correct? A competitive firm will exit the market in the…
A: Economic profit includes a normal profit. Even when economic profits are zero, the firm is earning…
Q: Suppose the price determined by the market is 4.5. Assume a perfectly competitive industry. Show all…
A: Profit maximising level of output achieved where MR = MC and MC should be rising Q Price TR MR…
Q: 1. For an individual firm in a perfectly competitive market, the cost function is c(y) = 8y2 + 5y +…
A: a) In a perfectly competitive market, At equilibrium MC = P = AR= MR Cost function (TC) = 8y2 + 5y +…
Q: A perfectly competitive firm in a constant-cost industry produces 3,000 units of a good at a total…
A: Hello. Since your question has multiple parts, we will solve the first question for you. If you want…
Q: Using the information in the table above, complete the following supply schedule for a company in…
A: Cost analysis is important concept of microeconomics, and very essential in modern business world
Q: explain why is the long run market supply curve horizontal in long run in perfect competitive…
A: “Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Suppose a perfectly competitive industry with constant costs is initially in long-run equilibrium.…
A: Perfect competition is an ideal market scenario, with following features: Homogenous products firms…
Q: In a perfect competitive industry, the market price is R20. An individual firm produces output at…
A: Answer: C (they should decrease production) Explanation: The price is less than the marginal cost…
Q: the short run, a firm that finds itself earning a loss should compare the market price to which cost…
A: Fixed cost is independent of output produced whereas variable cost varies with the level of…
Q: Consider two perfectly competitive industries, A and B, both operating in a state of long-run…
A: There are 2 perfectly competitive industrie's A and B.There is constant returns to scale for both…
Q: Suppose a perfectly competitive industry has 300 identical firms in the short run. Each firm faces a…
A: A perfectly competitive firm produces homogeneous goods which makes them price takers
Q: In a perfectly competitive market, please compare the short run and long run prices in an increasing…
A: Perfect competition refers to the market structure where there are a large of number of buyers and…
Q: In a perfectly competitive market, industry demand is given by Q = 1000 - 2OP. The typical fırm's…
A: Industry demand is given as Q = 1000 - 20P Total Cost is given as TC = = 300 + Q2 /3 Marginal Cost…
Q: 3. A perfectly competitive individual firm operates in a constant cost industry and produces a level…
A: Answer: (c). ATC=TCqATC=12×q2+5,000qATC=12q+5,000qATC=q2+5,000q Graphical presentation of ATC and…
Q: The graph on the right shows cost curves for a perfectly competitive firm. Firm's Supply Curve Use…
A:
Q: Q -1: For an individual firm in a perfectly competitive market, let its cost function be c(y) = 8y2…
A: Definition: Perfect competition leads to the Pareto-productive allocation of financial assets. On…
Q: A perfectly competitive industry has a large number of potential entrants. Each firm has an…
A: Hi Student, thanks for posting the question. As per the guideline, we are providing answer for the…
Q: Consider a perfectly competitive barley producing sector in Western Canada with increasing costs and…
A: The markets in an economy are considered to be of utmost importance for the economic, and financial…
Q: A perfectly competitive firm's total cost function is TC = 200 + 4q + 2q2. where q is the firm's…
A: A cost function consists of two types of costs:-fixed costs and variable costs. Fixed costs are…
Q: Equilibrium for the Perfectly Competitive Industry Consider Figure 34.1. Assume that the market…
A: A perfectly competitive market has a large number of buyers and sellers. The equilbrium price and…
Q: If a perfectly competitive firm operates in the short run but exits the industry in the long run,…
A: A perfect competitor exist the industry when Price < ATC (or TR < TC) and firm is incurring…
Q: . A competitive firm’s short-run supply curve is its ________ cost curve above its ________ cost…
A: 4. A competitive firm’s short-run supply curve is its________ cost curve above its ________ cost…
Q: 3. A perfectly competitive individual firm operates in a constant cost industry and produces a level…
A: We are going to use Marginal Cost curve as a proxy for Supply curve to answer this question. Note:…
Q: A firm sells its product in a perfectly competitive market where other firms charge a price of $90…
A: Given:Price (P)= $90MC = 10+4Q
Q: 1. A firm in a perfectly competitive industry has fixed costs of FC = 15, marginal costs of MC = 5+…
A: Firms in perfect competition are price takers because they are large number of firms selling…
Q: C. Table below shows some cost data for a perfectly competitive firm i. Is the firm operating in…
A: The perfect competition is a type of market which is characterized by a large number of buyers and…
Q: These diagrams, pertain to a perfectly competitive firm producing output q and the industry in which…
A: Answer:- (B) Firms to leave the industry, market supply to fall, and product price to rise.
A
a. In long-run equilibrium, how much will each firm produce?
b. What is the long-run
c. The industry's demand curve is ?? = 48,000 − 60?. How many firms are in the I ndustry?
d. If the industry demand decreases to ?? = 30,000 − 80? how will the industry respond?
Step by step
Solved in 4 steps
- (a) Let the industry producing soybeans be in a long-run equilibrium. What is the equilibrium price of a bushel of soybeans? How many billions of bushels are produced? How many farmers are there in the industry? What is the shipping fee per bushel of soybeans? (b) Suppose that the demand for soybeans drops due to decreased im- port by China and becomes Q = 15.3 − p. In a new long run equilibrium, what is the equilibrium price of a bushel of soybeans? How many billions of bushels are produced? How many farmers are there in the industry? What is the shipping fee per bushel? (c) Calculate the change in the producers’ surplus between the situations described in (a) and (b). (d) Show that the decrease in the producers’ surplus equals to the decrease in the total shipping fees as the industry contracts incrementally from the equilibrium output in (a) to the equilibrium output in (b).Suppose the shirts industry is perfectly competitive and begins in a long-run equilibrium. (a) Pluto Company invents a new production process that reduces the production cost. What happens to Pluto Company’s profits and the price of shirts in the short run when Pluto Company’s patent prevents other firms from using the new technology? (b) What happens in the long run when the patent expires and other firms are free to use the technology?A perfectly competitive industry is in long-run equilibrium. Each of the identical firms has a long- run cost function C = 100 + q². As a result, a firm's marginal cost function is MC = 2q. In the long-run competitive equilibrium, (a) How much does the firm produce? (b) What is the equilibrium price? (c) If the market quantity demanded at the equilibrium price is Q = 2500, how many firms are in the market?
- A firm produces a product in a perfectly competitive industry and has a total cost function TC= 50+4q+2q². a. At the short-run market price of $20, the firm is producing 5 units of output. Is the firm maximizing its profit? Explain. b. What quantity of output will the firm produce in the long run, assuming there is no change in cost structure? What will be the long-run equilibrium price? c. Graphically depict the long-run equilibrium for an individual firm within this market.In a perfectly competitive market demand function of a good is Q" = -30P+ 2250 and supply function is Q° = 20P. Firms that are active in this market have an identical cost function of 0* – 6Q² + 30Q Calculate the short run market price and short run profit of each firms. b. How many firms are active in market in short run? c. What will be the long run price in market? d. How many firms are active in market in long run? a.There are 80 perfectly competitive firms producing love letters, q. Each firm's cost function is C(q) = 4 + 4q². Market demand for love letters is Qp 240 - 5P. Use this information to answer questions #20 and #21. = 20. What is the short-run market equilibrium price for love letters? a. P = $8 b. P = $10 c. P = $16 d. P = $18.50 e. P = $24 21. What will happen to the number of firms selling love letters in the long-run? a. The number of firms in this market will decrease. b. The number of firms in this market will increase. C. The number of firms in this market will remain the same, but the market price will increase. d. The number of firms in this market will remain the same, but the market price will decrease. e. It is not possible to say what will happen to the number of firms without more information.
- Suppose the competitive tablet market is in long-run equilibrium. If at this equilibrium, the typical firm produces 20,000 tablets per month, total costs for this production are $1,800,000, and the minimum of the average variable costs is $70, what price will Instructions: Enter your responses as a whole number. a. induce entry into the market? When the price rises above $ b. cause firms to shut down production in the short run?Assume that the gold-mining industry is perfectly competitive. a) Illustrate a long-run equilibrium using diagrams for the gold market and for a representative gold mine. b) Suppose that an increase in jewelry demand induces a surge in the demand for gold. Using your diagrams, show what happens in the short run to the gold market and to each existing gold mine. c) If the demand for gold remains high, what would happen to the price over time? Specifically, would the new long-run equilibrium price be above, below, or equal to the short-run equilibrium price in part b)? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.13. Suppose a representative firm in a perfectly competitive industry has the following totalcost of production in the short run: TC=Q^3-40Q^2+600Q.a. What will be the long run equilibrium quantity for the firm? What will be the longrun equilibrium price in this industry?b. Let the industry demand be given by QD=12400-4P. How many firms will be activein the long-run equilibrium?c. Suppose the firm faces a positive demand shock that increases the industry demandto QD=16000-4P. Describe how the industry would respond and calculate thechange in the number of firms.
- Assume that a firm in a competitive market faces the following cost information. If the market price for this firm's product is $40, calculate the profit maximizing level of output for this firm using marginal analysis. a.Approximately where do you think the price will end up in this market over the long run? b.Last, instead of assuming a given price, how would you go about finding the equilibrium price if you were given information on market demand?b). The Philadelphia water ice industry is a constant cost industry. The demand for water ice shifts outward each year when it gets hot. What are the steps by which the competitive water ice market insures an increased amount of water ice. Explain and graph at the industry and firm levels. What is the long-run price of water ice?The graph below shows cost curves for a typical firm operating in a perfectly competitive market. Curve 1 represents Marginal Cost (MC), Curve 2 represents Average Variable Costs (AVC) and Curve 3 represents Average Total Costs (ATC). Suppose that the equilibrium price is $12. What will happen in this market in the long run? a. No new entry/no exit. b.Existing firms will exit. c.New firms will enter.
