Consider the market for wheat, which is approximately perfectly competitive. The average total cost of the typical wheat farm is ATC(Q) = 1+ Q, its average variable cost is AVC(Q) = Q, and its marginal cost is MC(Q) = 2Q. Suppose that there are currently 500 active given by p = 20 -L0 d.) How much profit will wheat farms earn when this market is in long-run equilibrium? Why? wheat farms in the market, and the market demand curve 1000 a.) What is the short-run market supply curve this market? e.) Calculate the number of wheat farms that will be active in the long-run equilibrium of this market. b.) Compute the short-run competitive equilibrium in this market. c.) Compute the profit or loss of the individual wheat farms in the short-run competitive equilibrium.

Consider the market for wheat, which is approximately perfectly competitive. The average total cost of the typical wheat farm is ATC(Q) = 1+ Q, its average variable cost is AVC(Q) = Q, and its marginal cost is MC(Q) = 2Q. Suppose that there are currently 500 active given by p = 20 -L0 d.) How much profit will wheat farms earn when this market is in long-run equilibrium? Why? wheat farms in the market, and the market demand curve 1000 a.) What is the short-run market supply curve this market? e.) Calculate the number of wheat farms that will be active in the long-run equilibrium of this market. b.) Compute the short-run competitive equilibrium in this market. c.) Compute the profit or loss of the individual wheat farms in the short-run competitive equilibrium.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

If there were 60 firms in this market, the short-run equilibrium price of titanium would be $________ per kilogram. At that price, firms in this industry would (earn a positive profit, shut down, earn zero profit, operate at a loss). Therefore, in the long run, firms would ( enter, exit, neither enter nor exit) the titanium market. Because you know that perfectly competitive firms earn (positive, zero, negative) economic profit in the long run, you know the long-run equilibrium price must be $_______ per kilogram. From the graph, you can see that this means there will be (20, 40, 60) firms operating in the titanium industry in long-run equilibrium.
Dear expert hand written not allowed.
The graph shown displays the cost curves for a firm in a perfectly competitive market. If the market price is $100, which of the following statements is true?graph_q10 This firm will earn positive profits in the short run. In the long run, the market supply curve will increase. Profits for this firm will decrease in the long run. I only I and II I and III I, II and III
A firm operates in a perfectly competitive industry with the following totoal production function: π (q) TR(q) - TC(q) = 20q - TC(q) where TC(q) = 50 + 4q + 2q2 a) find the firm's demand and supply functions b)Find the profit maximizing output. Is the firm making above normal profits? c)What is the long-run equilibrium?
Jessy is the manager of a watch company that is consider under perfectly competitive firm. The cost of producing watches is given by C = 300 + 3Q2, where Q is the level of output and C is total cost. If the price of watches is P54, how many watches should Jessy produce to maximize profit? Does the firm profit? Should it shut down in the short run? Explain
Consider the perfectly competitive market for tofu. Tofu production requires special inspections because of potential allergic reactions in consumers. Starting from long-run equilibrium, show graphically what happens in the short and long run to q. Q, P, and it in the market for tofu (in comparison to the starting point) if the US government decides to impose less stringent inspection requirements before any production can actually start.
Suppose that there are 90 firms in a market, each with the following cost function: C(q) = 65+4q2. Suppose the market demand is D(p) = 1,260 - 39p How much profit does each firm make in the short-run equilibrium? Your Answer:
Lasguns are produced by identical firms in a perfectly competitive market. Each firm's Total Cost function is TC=579+12q+q^2 and Marginal Cost function is MC=12+2q. What quantity does each firm produce in the long-run equilibrium?
Suppose the cost of renting a snowy bus were to fall from $30 per hour to $20 per hour. What do you expect would happen in the short-run (stage 1 equilibrium) to (a) the number of cones produced by each snowy bus; (b) total production of cones in the market, and (c) economic profits of snowy bus businesses? Briefly explain (you don't need to do any calculations, just explain inwords).
Could you solve the 4. question as follows shut down and operate TR= TFC= TVC= TC = PROFİT= The demand curve and supply curve for a perfectly competitive market are: Q = 500 – 5P and Q = 320 + P. The short run cost function of a representative firm in this market is TC = 150 + 3q2. According to these information Calculate the equilibrium price and quantity for this market. Calculate the profit maximizing output of this representative firm. Calculate the profit of this firm. Analyze this firm’s position in terms of shut down condition. Should this firm operate or shut-down in the short run. If all firms had the same cost structure, how many firms would compete at the equilibrium price computed in (a) above?
Consider the following cost curves faced by each firm: TC = 60 +0.5q and MC = q, where q is the individual output for each firm in a perfectly competitive market. Assume the market demand is described by theequation: Q = 100 - 2P where Q is the market output in 100s of units. Currently, the market price is $10. What would one expect to happen in this market in the long run? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. Forko In the long run, firms will either enter or exit the market. a b. In the long run, firms will enter the market. In the long run, firms will exit the market. In the long run, firms will neither enter nor exit the market.
After serving as President of the United States for eight years, Dena has retired from politics and has decided to become a wheat farmer. The market for wheat is perfectly competitive and the current market price for wheat is $10 per bushel. Dena is currently producing 8 bushels (Dena can only produce this good in whole units). Her total cost at 8 units of output is $88 and her variable cost at 8 units of output is $64. Dena knows that if she produces a 9th unit her total cost will become $97, and if she produces a 10th unit her total cost will become $110. Dena’s goal is to maximize her profits. Based on this information, identify whether each of the following would be true or false and briefly explain your reasoning. Dena is currently losing money in the short-run and she would be better off if she shutdown and produced zero. Dena is not currently profit maximizing at 8 units of output and she could increase her profits if she expanded output by one unit. Dena would increase her…