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In: Economics

The following table shows information for Hayek’s Maps, a perfectly competitive firm. a. Complete the MC...

The following table shows information for Hayek’s Maps, a perfectly competitive firm.

a. Complete the MC column in the table:

Output TC MC

0 $ 100 /

1 200

2 285

3 355

4 445

5 565

6 715

7 895

8 1,105

b. Given the prices in table below, fill in columns 2, 3, 4 and 5 of table. (Assume that partial units cannot be produced.) If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers.

(1) Price (2) Output (3)

Total Revenue (4)

Total Cost (5) Profit/Loss (6)

Total Supply (7)

Total Demand

$ 89 800

98 750

107 700

116 650

125 600

134 550

c. Suppose there are 120 firms identical to this one. Show the total supply in column 6 of table above.

d. If the market demand is as shown in column 7 of table , what will be the equilibrium price? What quantity will be traded in the market?

Equilibrium price: $

Quantity traded:

e. At equilibrium, what quantity will this firm produce? What will be its profit or loss?

Quantity: ; : $

f. As a result of your answer in (e), will firms enter or leave this industry?

Expert Solution

Rahul Sunny answered 1 year ago

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