Comment on these statements: 1: Supply curve of the Constant cost industry. 2: supply curve of the increasing cost industry. 3: supply curve of the Decreasing lost Industry.
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- 0 1 2 3 4 5 Problem 1. Fill out the missing data. Quantity Total Cost Marginal Cost Fixed Cost Variable Cost Average Total Cost - Average Variable Cost 7 10 37 22.5 10.50 15 The market price for the firm's output is $14.50. a) What quantity will the firm produce? Q = b) What is the firm's profit? Profit= P = P = c) What is the breakeven price? d) What is the shutdown price? f) Are consumers or producers affected by the tax more? Explain.How we can understand the Long-run Normal price in increasing cost industry, and the Long-run Normal price in constant cost industry?The diagram shows the demand and the supply curves for textbooks. $25 Price, P Demand $20 curve $15 $12 $10 $8 $6 $5 $0 50 0 10 16 20 24 28 30 Quantity, Q, of books Based on this figure, which of the following statements is correct? The Nash equilibrium price is $8. There are sellers willing to give away their textbooks for free. At a price of $12, 40 books will be sold. At a price of $6, there is an excess demand of 4 books. Supply curve 40 40
- Illustrate and explain the shape of the Long Run Industry Supply Curve for a Decreasing Cost Industry.The data in the table below are the monthly average variable costs (AVC), average total costs (ATC), and marginal costs (MC) for Alpacky, a typical alpaca wool-manufacturing firm in Peru. The alpaca wool industry is competitive. Output (units of wool) 0 1 2 3 4 5 6 AVC Market Price a. $22.00 b. $18.00 c. $16.00 20.00 17.00 16.70 17.00 18.00 22.33 ATC Qmax - 30.00 22.00 20.00 19.50 20.00 24.00 MC ($) For each market price given below, give the profit-maximizing output quantity and state whether Alpacky's profits are positive, negative, or zero. Also state whether Alpacky should produce or shut down in the short run. 20.00 14.00 16.00 18.00 22.00 44.00 Profit (Click to select) (Click to select) (Click to select) ✓ Produce in Short Run (Click to select) ✓ (Click to select) (Click to select) ✓The market for fertilizer is perfectly competitive. Firms in the market are producing output but are currently making economic losses. Which of the following statements is true about the price of fertilizer? Check all that apply. The price of fertilizer must be less than marginal cost. The price of fertilizer must be equal to average variable cost. The price of fertilizer must be less than average total cost. The following graphs show the cost curves faced a typical firm, the demand for fertilizer, and possible price and supply curves. (? (? Firm Market Demand ATC TAVO MC Quantity Quantity Price and Costs P. Price
- The industry in the figure below consists of many firms with identical cost structures, and the industry experiences constant returns to scale. Consider a change in demand from D₁ to D₂, which increases price from $20 to $30 in the short run. Price (S) 50 40- 30- 20 10- 0 10 20 Market 30 B Quantity reset D 40 5 50 LRS 1 S₂ Instructions: Round your answers to the nearest whole number. a. Draw the new supply line that occurs after the market adjustments take place. Instructions: Use the tool provided (S₂) and plot only the endpoints. The new equilibrium price will be $ b. Draw the long-run supply curve. Instructions: Use the tool provided (LRS) and plot only the endpoints over the entire range of output (0 - 60). and the new equilibrium quantity will beThe market for fertilizer is perfectly competitive. Firms in the market are producing output but are currently making economic losses. Which of the following statements is true about the price of fertilizer? Check all that apply. O The price of fertilizer must be less than average total cost. O The price of fertilizer must be equal to marginal cost. O The price of fertilizer must be less than average variable cost. The following graphs show the cost curves faced by a typical firm, the demand for fertilizer, and possible price and supply curves. ?) Firm Market Demand ATC P.--- --- TAVO P.- MC Quantity Quantity If firms in the market are producing output but are currently making economic losses, v illustrates the present situation for the typical firm in the market, and indicates the corresponding supply curve. Price and Costs PriceThe graph below shows the marginal cost (MC), average variable cost (AVC), and average total cost (ATC) curves for a firm in a competitive market. These curves imply a short-run supply curve that has two distinct parts. One part, not shown, lies along the vertical axis (quantity-0); this represents a condition of production shutdown. Where is the other part? Use the straight-line tool to drawit. To refer to the graphing tutorial for this question type, please click here Price and cost 18 15 14 13 12 10 19/21 SUBMIT ANSWER 13 OF 21 QUESTIONS C OMPLETED 28 MacBook Pro 금□ F7 F8 F9 F1o F2 F3 F5
- Explain why a firm carries on production in short run even if it makes negative profit. Use well labeled diagrams to support your explanation.Hand written solutions are strictly prohibitedThe diagram shows a price-taking bakery's marginal and average cost curves, and its isoprofit curves. The current market price for bread is P*= 2.50. Which of the following statements is correct? 8 Price, P (€); cost 4 3.70 2.50 2 0 0 Select one: 20 40 60 80 100 120 140 Quantity of loaves, Q 160 180 O a. The bakery is a price setter and sets its price as 2.50. b. The bakery maximises its profits by supplying 160 loaves. O c. The bakery's profit is 200. Marginal cost curve Isoprofit curve: €200 Isoprofit curve: €80 Firm's demand curve Zero-economic- profit curve (AC curve) 200 O d. The bakery's profit decreases until the quantity is 120, and then increases. e. The marginal cost curve is the bakery's supply curve.
