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11 The average cost (SR and LR) of Q = 50,000 is $10. / 5o,000,10) Ac SRE LR (s0,000, 1a) %3D With the current plant size, the minimum of short run average cost (SRAC) is $8, at uie output level of Q = 62,000. (62.000, 8) SRAC a. Sketch the firm's LRAC, SRAC, SRMC, and LRMC curves. %3D b. Assume that the market price in the short run is P = $11. Given the way you drew the diagram, identify the short run equilibrium quantity (Qs1) in the graph. C. Next, assume that the price of $11 persists long enough for the firm to make any profitable long run adjustment to plant size. Identify equilibrium quantity (Qs2). d. Finally, assume that the market attains long run equilibrium. Given the way you drew the graph, identify this firm's equilibrium quantity (Q*) in the diagram.

11 The average cost (SR and LR) of Q = 50,000 is $10. / 5o,000,10) Ac SRE LR (s0,000, 1a) %3D With the current plant size, the minimum of short run average cost (SRAC) is $8, at uie output level of Q = 62,000. (62.000, 8) SRAC a. Sketch the firm's LRAC, SRAC, SRMC, and LRMC curves. %3D b. Assume that the market price in the short run is P = $11. Given the way you drew the diagram, identify the short run equilibrium quantity (Qs1) in the graph. C. Next, assume that the price of $11 persists long enough for the firm to make any profitable long run adjustment to plant size. Identify equilibrium quantity (Qs2). d. Finally, assume that the market attains long run equilibrium. Given the way you drew the graph, identify this firm's equilibrium quantity (Q*) in the diagram.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Could I have help figuring out part b-d
100 IS AC=TC/Q= G0>140 11. Envelope Curve I R00 =0-7. Hazel's Hazelnuts sells in a perfectly competitive industry. The firm's minimum long run average cost (LRAC) occurs at output of Q = 100,000. %3D The firm is currently operating with a smaller plant size-the size that achieves the minimum long run average cost of producing 50,000 units.
Transcribed Image Text:100 IS AC=TC/Q= G0>140 11. Envelope Curve I R00 =0-7. Hazel's Hazelnuts sells in a perfectly competitive industry. The firm's minimum long run average cost (LRAC) occurs at output of Q = 100,000. %3D The firm is currently operating with a smaller plant size-the size that achieves the minimum long run average cost of producing 50,000 units.
LRAC f100:000, ? ) 3 The average cost (SR and LR) of Q = 50,000 is $10. / 5o,00010) Ac 11 SR E LR With the current plant size, the minimum of short run average cost (SRAC) is $8, at uie output level of Q = 62,000. (62.000, 8) SRAC a. Sketch the firm's LRAC, SRAC, SRMC, and LRMC curves. b. Assume that the market price in the short run is P = $11. Given the way you drew the diagram, identify the short run equilibrium quantity (Qs1) in the graph. C. Next, assume that the price of $11 persists long enough for the firm to make any profitable long run adjustment to plant size. Identify equilibrium quantity (Qs2). d. Finally, assume that the market attains long run equilibrium. Given the way you drew the graph, identify this firm's equilibrium quantity (Q*) in the diagram. SRME (7 IS 13 SRAC LRMC SR 12 10 LRAL 1. 4 3. 2. bolos 00000
Transcribed Image Text:LRAC f100:000, ? ) 3 The average cost (SR and LR) of Q = 50,000 is $10. / 5o,00010) Ac 11 SR E LR With the current plant size, the minimum of short run average cost (SRAC) is $8, at uie output level of Q = 62,000. (62.000, 8) SRAC a. Sketch the firm's LRAC, SRAC, SRMC, and LRMC curves. b. Assume that the market price in the short run is P = $11. Given the way you drew the diagram, identify the short run equilibrium quantity (Qs1) in the graph. C. Next, assume that the price of $11 persists long enough for the firm to make any profitable long run adjustment to plant size. Identify equilibrium quantity (Qs2). d. Finally, assume that the market attains long run equilibrium. Given the way you drew the graph, identify this firm's equilibrium quantity (Q*) in the diagram. SRME (7 IS 13 SRAC LRMC SR 12 10 LRAL 1. 4 3. 2. bolos 00000
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