Question
In: Economics
A firm operating in a perfectly competitive market has the following total cost function: TC=0.4Q2+40. Its...
A firm operating in a perfectly competitive market has the following total cost function: TC=0.4Q2+40. Its marginal cost function is given by: MC=0.8Q. There are 20 identical firms in the short-run in the market. In addition, the demand function is given by: Q=300-5P
a) Find the Supply Function for the Firm in the short-run
b) What is the equilibrium price and quantity in the market in the short-run?
c) How much does each of the 20 firms produce in the short-run?
d) How much profits does each firm make in the short-run? Will there be entry or exit in the long-run?
e) If ATC is minimized at Q=10, what is the price of the product in thelong-run?
f) How many firms are in the market in the long-run?
Solutions
Rahul Sunny answered 2 years agoRelated Solutions
A firm operating in a perfectly competitive market has the following total cost function: TC=0.4Q2+40 There...
A firm operating in a perfectly competitive market has the
following total cost function: TC=0.4Q2+40 There are 20
identical firms in the short-run in the market. In addition, the
demand function is given by: Q=300-5P
a) Find the Supply Function for the Firm in the
short-run
b) What is the equilibrium price and
quantity in the market in the
short-run?
c) How much does each of the 20 firms produce in the
short-run?
d) How much profits does each firm...
Perfectly competitive market. An individual firm has the following cost function: TC = 36 + 2q...
Perfectly competitive market. An individual firm has the
following cost function:
TC = 36 + 2q +q2.
Find the firm’s supply curve.
If there are 100 identical firms in the market, what is
the market supply curve?
In the long run, how many units would each firm produce?
What is the price in the long run?
What is each firm’s profit? Show this.
If the market demand= Qd = 614 - p, how many firms would
be in the market?
In a perfectly competitive industry, each firm has a total cost function of TC = 400...
In a perfectly competitive industry, each firm has a total cost
function of TC = 400 + 10q + q2 and a marginal cost curve of MC =
10 + 2q if it produces a positive quantity of output q. If a firm
produces zero output it has no costs. The market price is $50.
Which statement is true?]
a. Each firm produces 20 units of output; the industry will
require entry to reach its long-run equilibrium.
b. Each firm...
A firm in a perfectly competitive market has the following cost curve: TC = 200 +...
A firm in a perfectly competitive market has the following cost
curve: TC = 200 + Q + 2Q^2 and The market demand is: Qd = 121 - P.
There are 20 identical firms in the market (N =20) in the
short-run.
e) At the equilibrium price found in part (c), how much profit
is each firm making in the short-run? Will there be entry or exit
in this market in the long-run?
f) What is the price of the...
A firm in a perfectly competitive market has the following cost curve: TC = 200 +...
A firm in a perfectly competitive market has the following cost
curve: TC = 200 + Q + 2Q^2 and The market demand is: Qd = 121 - P.
There are 20 identical firms in the market (N =20) in the
short-run.
What is the price of the product in the long-run?
Suppose in the short run a perfectly competitive firm has the total cost function: TC(Q)=675 +...
Suppose in the short run a perfectly competitive firm has the
total cost function: TC(Q)=675 + 3q2 where q is the firm's quantity
of output. If the market price is P=240, how much profit will this
firm earn if it maximizes its profit?
b) how much profit will this firm make?
c) Given your answer to b), what will happen to the market price
as we move from the short run
to the long run?
d) What is the break-even...
Assume that a firm in perfectly competitive industry has the following total cost schedule: Q TC...
Assume that a firm in perfectly competitive industry has the
following total cost schedule:
Q
TC
10
110
15
150
20
180
25
225
30
300
35
385
40
480
Calculate the marginal cost and average cost schedule for the
firm.
If the prevailing market price is $17 per unit, how many units
will be produced and sold? What at the profits per unit?
What are the total profits?
Is the industry in long-run equilibrium at this price?
The total cost function of a perfectly competitive firm is TC= 12+2q^2+4q. What is the firm's...
The total cost function of a perfectly competitive firm is TC=
12+2q^2+4q. What is the firm's optimal quantity at a market price
of $12? If over time, the firm could exit and not pay its fixed
cost, what would the optimal quantity be?
A firm produces a product in a competitive industry and has a total cost function TC...
A firm produces a product in a competitive industry and has a
total cost function TC = 50 + 4Q +2Q² and MC = 4 + 4Q. At the given
market price of $20, the firm is producing 5 units of output. Is
the firm maximizing profit ? What quantity of output should the
firm produce in the long run?
Consider a perfectly competitive market where each firm’s total cost function is TC = q^3 –...
Consider a perfectly competitive market where each firm’s total
cost function is TC = q^3 – 10q^2 + 50q.
a) What is the long run equilibrium price and quantity for each
firm?
b) The industry demand function is Qd=2000-10p. How many firms
are there in the industry in the long run?
c) The demand has changed to Qd=4000-18p. Describe the
industry’s response to the demand shock and calculate the change in
the number of firms in the long run equilibrium.
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