Question
In: Economics
Assume that a perfectly competitive hand sanitiser market is in long-run equilibrium. The price of hand...
Assume that a perfectly competitive hand sanitiser market is in long-run equilibrium. The price of hand sanitisers is observed to increase during the COVID 19 pandemic, and then it returns back to its normal price after the pandemic. Use the diagram below to discuss this market before, during and after the pandemic. Include in your discussion the profit levels in each case.
Solutions
Rahul Sunny answered 9 months agoRelated Solutions
Assume that a perfectly competitive hand sanitiser market is in long-run equilibrium. The price of hand...
Assume that a perfectly competitive hand sanitiser market is in
long-run equilibrium. The price of hand sanitisers is observed to
increase during the COVID 19 pandemic, and then it returns back to
its normal price after the pandemic.Include in your discussion the
profit levels in each case.
2. Assume the market for soybeans is perfectly competitive and in long-run equilibrium, and Norma’s Soybeans...
2. Assume the
market for soybeans is perfectly competitive and in long-run
equilibrium, and Norma’s Soybeans is a small farm in the
market.
Draw correctly labeled side-by-side graphs of both the
market for soybeans and the firm, labeling the market equilibrium
Pm and Qm and Norma’s Soybean equilibrium Pf and qf.
Is Norma’s Soybeans earning economic profits, economic
losses, or a normal profit?
Now assume that in the soybean market there is a huge
drought that ruins the soybean harvest...
A perfectly competitive market is initially in long-run competitive equilibrium. Then, market demand falls. By the...
A perfectly competitive market is initially in long-run
competitive equilibrium. Then, market demand falls. By the time all
adjustments have been made, price will be __________ its original
level if the industry is a(n) __________ costs industry.
a. above; decreasing
b. at; constant
c. at; increasing
d. below; increasing
e. a and d
1) Imagine a perfectly competitive market that is currently in a long-run equilibrium with price=$10, individual...
1) Imagine a perfectly competitive market that is currently in a
long-run equilibrium with price=$10, individual firm quantity set
at 10 units, and 100 active firms. Scientific discoveries about the
health benefits of this good lead to a permanent
increase in demand for this good (but no changes
in firm costs).
Once the market is able to fully adjust, then compared to the
original long-run equilibrium, the new long-run equilibrium will
have
A) a lower price and fewer active firms...
Suppose that a perfectly competitive industry is in long-run equilibrium. Then the price of a complementary...
Suppose that a perfectly competitive industry is in long-run
equilibrium. Then the price of a complementary good decreases. Use
two graphs, one for the firm, and one for the industry (and words)
to explain what will happen in the short run, and then the long
run, to: a. The market demand curve? b. The market supply curve? c.
Market price? d. Market output? e. Representative firm output? f.
Representative firm profit?
Assume that a perfectly competitive, constant cost industry is in a long run equilibrium with 60...
Assume that a perfectly competitive, constant cost industry is
in a long run equilibrium with 60 firms. Each firm is producing 90
units of output which it sells at the price of $41 per unit; out of
this amount each firm is paying $3 tax per unit of the output. The
government decides to decrease the tax, so the firms will be paying
$1 tax per unit.
a) Explain what would happen in the short run to the equilibrium
price...
assume that a perfectly competitive ,constant cost industry is in a long run equilibrium with 20...
assume that a perfectly competitive ,constant cost industry is
in a long run equilibrium with 20 firms .
each firm is producing 150 units of output which it sells at the
price of R 20 per unit ,out of this amount each firm is paying R 4
tax per unit of the output .the government decide to abolish the
tax
a)Explain what would happen in the short run to the equilibrium
price and industry output,number of firms in the industry...
Assume that a perfectly competitive, constant cost industry is in a long run equilibrium with 60...
Assume that a perfectly competitive, constant cost industry is
in a long run equilibrium with 60 firms. Each firm is producing 90
units of output which it sells at the price of $41 per unit; out of
this amount each firm is paying $3 tax per unit of the output. The
government decides to decrease the tax, so the firms will be paying
$1 tax per unit.
a) Explain what would happen in the short run to the equilibrium
price...
Suppose all firms in a perfectly competitive market are in long-run equilibrium. Illustrate what a perfectly...
Suppose all firms in a perfectly competitive market are
in long-run equilibrium. Illustrate what a perfectly competitive
firm will do if market demand rises.
Draw a graph showing a market and a perfectly competitive firm in long run equilibrium.
Draw a graph showing a market and a perfectly competitive firm
in long run equilibrium.
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