1. Based on the above information, what is the type of the market? Why? 2. Based on the above table, at which level of output the firm gets maximum revenue? B. Based on the above table, what is the value of profit maximization output (Q*) and Pro Based on the above table, Does the firm get profit/loss if the firm produces Q* units?

1. Based on the above information, what is the type of the market? Why? 2. Based on the above table, at which level of output the firm gets maximum revenue? B. Based on the above table, what is the value of profit maximization output (Q) and Pro Based on the above table, Does the firm get profit/loss if the firm produces Q units?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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QUESTION 2: Consider a competitive market. There are X number of firms in this market. Every firm is facing the following set up: a. How does the number of firms in the industry, affect each firm's demand curve? Why? b. What will be the production in this market? What price will the companies charge? How much profit will firms make? c. What is the minimum number of firms in the market so that everyone is making losses? d. How many firms will exist in this market in the long-run?
Bonus Question 4 1 A firm makes three products, in quantities X, Y and Z. It wishes to maximize its profit function: x=8X+16Y+4Z-0.8X2-0.8Y2-2² i) However, in order to satisfy customer orders, it must produce a total of 24 items which are either product X or product Y. Show how many of each of its three products it should produce and find the profit it makes.
Due to an increase in the price of a competitor's product, the demand for a firm's product increases sharply. How is this most likely to affect the firm's marginal revenue and marginal cost? OA. Both marginal revenue and marginal cost will increase. OB. Marginal revenue will increase but marginal cost will decrease. OC. Marginal revenue will increase but marginal cost will not change. OD. Both marginal revenue and marginal cost will not be affected. OE Marginal revenue will not change but marginal cost will increase.
1. Competitive market Practice problem Wheat farmer Joe has the cost function of C(q) 160,000 + 100q+q². The market for wheat is competitive and there are many farmers like this, with the same cost function. The demand function is Q = 15000 - 10p. = (a) In the short run, below which price should Joe shut down? (b) In the short run, there are 19 farmers like Joe (so 20 farmers in total). How much should Joe produce? What will the price be? (c) What is the price below which Joe would shut down in the long run? (d) How many farmers will operate in the long run? (e) What is the market elasticity of demand at long-run equilibrium point?
1c. Using Excel or grid paper, based on the above information, plot the demand curve, MR curve, MC curve and ATC curve. Label the profit-maximizing quantity and price, total cost, total revenue and profit.
Which of the following is NOT an expected outcome for a firm in a market where sellers have market power? Select one: a. An inefficiently small output b. Lower costs c. Higher prices d. Larger economic profits
If a firm's marginal revenue is smaller than its marginal cost, then the firm should a. increase output to increase profit. b. decrease output to increase profit. c. keep output the same. d. collect additional information before taking any action.
2. Suppose that a market consists of 650 idetical fims, all with the same cost curve: TC(q) = 325q² + 0.3. The market demand is given by Qd(p) = 50 – p (a) What is the equilibriun price and quantity? (b) What quantity must each firm produce and sell at equilibrium? (c) Do fims make positive profits in the market equilibrium? (d) Calculate consumers' surplus, producers' surplus and total surplus. (e) The government imposes a tax of 12 per unit of the product on the suppliers. What will be the new equilibrium price and quantity? (f) Do firms make positive profits at market equilibrium? (g) What will be the new consumes surplus, produces surplus and total surplus? (h) Calculate the value of the DWL imposed by the tax.
4. Hundreds of music stores have been closing in the face of stagnant demand for CDs because of new competition by online music vendors. a. How would price competition from these new sources cause a retail store to close? b. In the long run, will CDs remain a viable product? If so, how?
Perfect Competition MC - Marginal Cost MR - Marginal Revenue ATC - Average Total Cost Refer to the figure above. If this firm is producing the profit-maximizing quantity and selling it at the profit-maximizing price, the firm's total revenue will be: $240 $90 $60 $180
I need answers of B, C, D. Thanks