Suppose that there are 5 hamburger stands each with identical short-run total cost curves described as: ...

Suppose that there are 5 hamburger stands each with identical short-run total cost curves described as:

SRTC=16+(Q²/100)

where Q is the number of hamburgers each stand produces per day. If the daily market demand for this perfectly competitive market is Q_d=900-200P, how much profit will each stand make per day (if any)?

Solutions

Expert Solution

Rahul Sunny answered 1 year ago

Next > < Previous

Related Solutions

5. In a certain market in the long-run, suppose the total cost function for each firm...

5. In a certain market in the long-run, suppose the total cost function for each firm and potential entrant is given by TC = 5Q3 -10Q2.+20Q. Market demand is given by D(P)= 2000 - 100P . 1) In equilibrium, how many units will each firm produce? 2) What is the market equilibrium price? 3) What is total market demand? 4) What is the equilibrium number of firms in the long-run?

(Deriving SR Cost Curves) In this problem, we’ll work through deriving short-run total cost and marginal...

(Deriving SR Cost Curves) In this problem, we’ll work through deriving short-run total cost and marginal cost functions from a production function. Such cost functions show how costs vary when quantity changes (you’re typical cost curves from intro to micro!). A firm has a production function ?? = 0.25????^0.5, the rental rate of capital is $100, and the wage rate is $25. In the short-run, capital is fixed at 100 units. a. What is the firm’s short-run production function, q(L)?...

Cardboard boxes are produced in a perfectly competitive market. Each identical firm has a short-run total...

Cardboard boxes are produced in a perfectly competitive market. Each identical firm has a short-run total cost curve of TC = 2Q^3 - 12Q^2 + 10Q + 20 where quantity is measured in thousands of boxes per week. The marginal cost of production is given by MC = 6Q^2 -24Q + 10. Calculate the price below which a firm in the market will not produce any output (the shut-down price).

Suppose in Pakistan, all the firms are identical with identical cost curves which mean industry is...

Suppose in Pakistan, all the firms are identical with identical cost curves which mean industry is perfectly competitive. Now please consider this following information about the industry: A representative firm’s total cost is given by the equation TC = 100 + q2 + q where q is the quantity of output produced by the firm. You also know that the market demand for this product is given by the equation P = 1000 – 2Q where Q is the market...

Suppose that there are 1,000 firms in a perfectly competitive industry, each with a short-run total...

Suppose that there are 1,000 firms in a perfectly competitive industry, each with a short-run total cost curve given by TC = 800 + 8Q + 0.1Q2. A) What is the profit-maximizing output level for each firm at a market price of $20? B) How much profit does each firm make at a market price of $20? C) Explain whether the industry will expand or contract in the long run.

(b) If you drew a firms short run and long run cost curves in the same...

(b) If you drew a firms short run and long run cost curves in the same graph, the short run cost curve would always be above the long run cost curve, except at one level of output. Why? What is special about this level of output? (c) On a carefully labeled diagram, illustrate the cost minimizing bundle A for a firm with cobb-douglas technology. Now consider an increase in the quantity target to some point B. Draw the new bundle...

Draw a long run average cost curve, as well as several short run average cost curves...

Draw a long run average cost curve, as well as several short run average cost curves if the firm has increasing economies of scale followed by decreasing economies of scale.

Suppose that a firm’s short-run total cost function is STC= 0.1q2 + 4q +100. Will the...

Suppose that a firm’s short-run total cost function is STC= 0.1q2 + 4q +100. Will the producer surplus at P=$15 be $302.5? Suppose that a firm is price taker. If the price is equal to marginal cost, then the profit is being maximized. If a firm wished to maximize profit, it will always reduce output if wage rates rise. If a competitive firm's price is below its marginal cost, an increase in production will usually decrease profits. A profit‑maximizing firm...

1 The short-run average total cost curve and the long-run average total cost curve are similarly...

1 The short-run average total cost curve and the long-run average total cost curve are similarly shaped. What are the causes for the short run and long-run average total cost curve to slope down and up? 2 Mr. Salim has been working at a car manufacturing plant forthe last 4 years. He recently lost his job due to the downsizing of the company he works for due topoor car sales and poor economic performance. What type of unemployment is Salim...

Suppose that the short-run supply and demand for pineapples in a certain town are described by...

Suppose that the short-run supply and demand for pineapples in a certain town are described by the following two equations: QS= 1,000, QD= 2,000−200p. Pineapples are an imported produce in this market, so the government imposes a tax of $1 per pineapple. Which of the following statements is true? The after-tax equilibrium is given by pS=5, pB=6 and QT= 1,000. The after-tax equilibrium is given by pS=4, pB=5 and QT= 1,000. The deadweight loss of this tax is zero. Only...

Subjects