9.- A competitive firm reaches the minimum of the long-run average cost for y = 20 when it operates with the short-run cost function C = yi3-20yi2 + 100yi + 8000, where yi is the production of the firm. Then the long-run price equilibrium will be 500. If the government imposes a specific tax on output of 40 euros, what are the taxes collected by the government in the short-run and in the long-run, if the market demand is given by x = 2500 - 3p, where x is the quantity demanded by consumers and p is the price? Will the government collect more or less taxes in the long-run than in the short-run? Why? 9.- A competitive firm reaches the minimum of the long-run average cost for y₁= 20 when itoperates with the short-run cost function C = y₁³-20y² + 100y₁+8000, where y, is the productionof the firm. Then the long-run price equilibrium will be 500. If the government imposes a specifictax on output of 40 euros, what are the taxes collected by the government in the short-run andin the long-run, if the market demand is given by x = 2500-3p, where x is the quantitydemanded by consumers and p is the price? Will the government collect more or less taxes inthe long-run than in the short-run? Why?

The short run cost function is given as The equiibrium price in the long run is $500. The government…

Answered: 9.- A competitive firm reaches the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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9.- A competitive firm reaches the minimum of the long-run average cost for y = 20 when it operates with the short-run cost function C = yi3-20yi2 + 100yi + 8000, where yi is the production of the firm. Then the long-run price equilibrium will be 500. If the government imposes a specific tax on output of 40 euros, what are the taxes collected by the government in the short-run and in the long-run, if the market demand is given by x = 2500 - 3p, where x is the quantity demanded by consumers and p is the price? Will the government collect more or less taxes in the long-run than in the short-run? Why?

9.- A competitive firm reaches the minimum of the long-run average cost for y₁= 20 when it
operates with the short-run cost function C = y₁³-20y² + 100y₁+8000, where y, is the production
of the firm. Then the long-run price equilibrium will be 500. If the government imposes a specific
tax on output of 40 euros, what are the taxes collected by the government in the short-run and
in the long-run, if the market demand is given by x = 2500-3p, where x is the quantity
demanded by consumers and p is the price? Will the government collect more or less taxes in
the long-run than in the short-run? Why?

Definition Video Definition Point where the demand and supply curves intersect. At the equilibrium price the quantity supplied of a good is equal to the quantity demanded. When the market is not in equilibrium, market surplus or market shortage occurs. The region that is above the price equilibrium indicates market surplus and the region below the price equilibrium indicates market shortage. Video

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