Do this problem using excel solver. Africa controls 80% of the world's lithium refining, a material needed for the production of lithium batteries in electric vehicles. The demand for lithium batteries is P = $20,000 - 2.5 Q, where Q is in tons and P is in $/ton. The long run marginal and average cost of production is constant at $2,000/ton. a) Assuming the monopoly model applies, determine price, quantity, and profit for Africa using excel solver b) Now assume new firms enter the lithium market, resulting in (perfect) competition. Determine the price, quantity, and profits, when the industry is in (long run) equilibrium using excel solver c) Finally, compare social welfare for the two cases, and determine deadweight loss using excel solver.

Do this problem using excel solver. Africa controls 80% of the world's lithium refining, a material needed for the production of lithium batteries in electric vehicles. The demand for lithium batteries is P = $20,000 - 2.5 Q, where Q is in tons and P is in $/ton. The long run marginal and average cost of production is constant at $2,000/ton. a) Assuming the monopoly model applies, determine price, quantity, and profit for Africa using excel solver b) Now assume new firms enter the lithium market, resulting in (perfect) competition. Determine the price, quantity, and profits, when the industry is in (long run) equilibrium using excel solver c) Finally, compare social welfare for the two cases, and determine deadweight loss using excel solver.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 3.4CE

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Question

Do this problem using excel solver. Africa
controls 80% of the world's lithium refining, a
material needed for the production of lithium
batteries in electric vehicles. The demand for
lithium batteries is P = $20,000 - 2.5 Q, where Q
is in tons and P is in $/ton. The long run
marginal and average cost of production is
constant at $2,000/ton. a) Assuming the
monopoly model applies, determine price,
quantity, and profit for Africa using excel solver
b) Now assume new firms enter the lithium
market, resulting in (perfect) competition.
Determine the price, quantity, and profits, when
the industry is in (long run) equilibrium using
excel solver c) Finally, compare social welfare for
the two cases, and determine deadweight loss
using excel solver.

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