A firm is jointly producing two products with variable proportions. If the price of one of the products changes, profit- maximizing managers must adjust both the total production of the jointly produced products and the products' proportions. Select one a. True b. False
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- How to identify the differentiation factor from our competitors.Compute the equilibrium prices, quantities, and profits for both firms. Consider now the first stage.The figure depicts the demand curve of a firm producing cars, together with its marginal cost, average cost, and isoprofit curves. Based on this figure, which of the following statements are correct? 8,000 Price, Marginal cost ($) 0 E Quantity of cars, Q At A, the firm makes positive profits. The firm makes the same profit at B and D. O Profit margin is the same at B and D. O The slope of the isoprofit is zero at D. MC Isoprofit A Isoprofit B AC 100
- Short-run supply and long-run equilibrium Consiber the competitive market for rhodium. Assume that no matter how many firms operate in the induatry, every firm is identical and faces the same marpinal cost (MC), averapt total cost (ATC), and average variable cost (AVC ) curves plotted in the following praph. The following graph plots the market demand curve for thodium. If there were 10 firms in this market, the short-run equilibrium price of rhodium would be per pound. At that price, firms in this industry would. Therefore, in the long run, firms would the rhodium market. Because you know that competitive firms earn economic profit in the long run, you know the long-run equilibrium price must be per pound. From the graph, you can see that this means there will be firms operating in the rhodium industry in long-run equilibrium. True or False: Assuming implicit costs are positive, each of the firms operating in this industry in the long run earns positive accounting profit. True FalseName the market structure in which the firms sell products that are similar but not identicalTrue/ False Firm can not influence price in perfect competition.
- Rambutan is a fruit prized in Eastern Asia for its unique hairy look. Once peeled, it reveals a sweet, slightly sour, grape-like, gummy-tasting fruit. The graph shows the average total cost, marginal revenue, and marginal cost curves of a perfectly or (purely) competitive rambutan farmer. This firm is incurring a firms will this market. In the long run, What is this firm's profit or loss, rounded to the nearest penny? If the market price fell to $9.51, the firm would Price per bushel $12.11 10.11 9.51 MR C 5.4 A MC B ATC 7 Quantity (bushels)Whether firms are profit maximisers or are pursuing some alternative objective(s), many set prices, not by referring to marginal cost and marginal revenue, but by adding a profit mark-up to average cost. A firm that is a profit maximiser is likely to adjust its mark-up less frequently than a firm that is a profit satisficer. True FalseWhat is the total variable cost in perfectly competetive firms
- True or false: In a perfectly competetive market, when AVP<P<ATC, a firm will not produce any output to minimize its costs. Explain why using a graph.Mondi Company produces party boxes that are sold in bundles of 1000 boxes. The market is highly competitive, with boxes currently selling for R100 per thousand. The company has a total and marginal cost curve given by: TC = 3,000,000 + 0.001Q2 MC = 0.002Q Q is measured in thousand box bundles per year. [5] a. Determine Mondi's profit maximizing quantity. b. Calculate if the firm is earning a profit or a loss? c. Based on the analysis above, should Mondi Company operate or shut down in the shortrun?a. John operates a firm producing t shirts. There are many such firms producingidentical products to John. What market structure is this? Is it possible for John tomake a profit in the long run? Illustrate using an appropriate diagram. b. John decides to innovate his business and begins printing t shirts with customercreated content. Will John be able to make a profit in the short run and the longrun? Explain using relevant diagrams and comment on the implied market c. Provide a strategy for John to make greater than normal profits in the long run. Isthis likely to be the case in the market for this good?