Assume that the market for onions is competitive/perfectly competitive market. Further assume that this market is in a long run equilibrium with an equilibrium price of $3 for a bag of onions. Ollie's House of Onions is a firm in the market for onions. Ollie's sells 200 bags of onions each week. 1. Using the model of a competitive/perfectly competitive market show what are Ollie's MC, ATC, MR, total revenue, total cost, and economic profit? Show all of this on a graph (see instructions below). 2. Assume that the demand for onions increases and the price per bag of onions goes to $5. Also assume that Ollie's ATC rises to $3.50 a bag as he maximizes profit by selling 400 bags a week. What are Ollie's total revenue, total costs and economic profit? Show all of this on a graph (see instructions below). Note: The graphs for each question can be created manually (drawn by hand on paper) or using any software that I can read, scanned and submitted along with this assignment as an uploaded file.
Assume that the market for onions is
Please explain each step.
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Assume that the market for onions is competitive/perfectly competitive market. Further assume that this market is in
a long run equilibrium with an equilibrium price of $3 for a bag of onions. Ollie's House of Onions is a firm in the
market for onions. Ollie's sells 200 bags of onions each week.
1. Using the model of a competitive/perfectly competitive market show what are Ollie's MC, ATC, MR, total revenue,
total cost, and economic profit? Show all of this on a graph (see instructions below).
2. Assume that the demand for onions increases and the price per bag of onions goes to $5. Also assume that Ollie's
ATC rises to $3.50 a bag as he maximizes profit by selling 400 bags a week. What are Ollie's total revenue, total
costs and economic profit? Show all of this on a graph (see instructions below).
Note: The graphs for each question can be created manually (drawn by hand on paper) or using any software that I
can read, scanned and submitted along with this assignment as an uploaded file.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3b45535c-da16-4b00-af7e-f9b67da03094%2F31e18a98-1997-4c1f-8934-f2bd297e7c96%2Fft7tjm2_processed.jpeg&w=3840&q=75)
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